IMA Columbia Chapter Blog

Managing Skills Mismatches at Your Firm

2011-03-17T09:04:00.000-07:00

Managing Skills Mismatches at Your Firm
Look beyond the job description ‘silo.’

If you’re like managers in many other organizations, you’ve had to thin the ranks of your finance team during the recession. Now you may be considering adding staff to ensure you have the right mix of skills to help you take advantage of opportunities that emerge as conditions improve. But despite historically high unemployment levels today, hiring the right new employees is not as easy as it may seem.

This is largely because companies’ expectations are high when they hire. They want professionals who possess an ideal combination of skills and experience and who are a fit with the prevailing workplace culture. Fully half of chief executive officers interviewed for the latest Robert Half Financial Hiring Index said locating highly skilled candidates is a challenge.
Companies can best address staffing issues by taking a bigger picture view of their needs. No manager has a crystal ball, but based on current activity levels and a reasonable forecast of the future, what do you anticipate your firm’s or department’s workload to be? This step will help you decide which type of employee is required – full-time, part-time or temporary.

In some cases, you may not need to hire at all. Often firms overlook talent within their own organizations because of an existing skills mismatch. Before you start your candidate search, take a hard look at what skills your current team can deliver. A thorough assessment of your staff’s abilities will help you identify true skills gaps (needs that you must fill with outside resources) as well as skills “mismatches” (needs you can address by adjusting the responsibilities of existing team members). This insight will allow you to hire strategically while ensuring you also are making the best use of talent already in place.

A skills mismatch does not always mean an employee is serving in the wrong role at your firm; it can also exist when his range of talents is not being fully utilized. Management’s tendency to define a staff member’s abilities by what is outlined in a job description often leads to a skills mismatch. While you may have used this criteria to hire an employee, and probably have relied on it since to measure her performance, it is important to look beyond the job description “silo.”
Here’s why: During the downturn, you likely asked your team – particularly, your most capable employees – to assume additional or different responsibilities, and perhaps, cover for various positions left open due to cutbacks. This intense and prolonged “on-the-job training” required many of your employees to stretch their abilities beyond the confines of their pre-recession job responsibilities. Moving forward, you should leverage any talented staff member’s expanded skill set to the fullest in order to create benefits for the firm.

Consider former professional football player William “The Refrigerator” Perry, who was drafted by the Chicago Bears in the mid-1980s as a defensive lineman. He excelled in his role, but coach Mike Ditka soon recognized that Perry had potential to play well offensively, too – a rare combination. Ditka used Perry as a fullback in many critical goal-line plays – including a rushing touchdown in Super Bowl XX that helped seal the Bears’ victory over the New England Patriots.
By adjusting or expanding the responsibilities of the most productive workers on your team, you may find they will flourish in entirely different ways that not only make them feel valued but also create real benefits for the firm.

Of course, tapping internal talent won’t address every skills need you have and you’ll need to make strategic hires if business demands continue to grow. But working with your existing team to find ways to help them develop in new areas makes for more versatile employees and also gives them greater satisfaction as they assist in meeting the business’s changing needs.

This article is provided courtesy of Robert Half International, parent company of Accountemps, Robert Half Finance & Accounting and Robert Half Management Resources. Robert Half is the world’s first and largest specialized staffing firm placing accounting and finance professionals on a temporary, full-time and project basis. Follow Robert Half on Twitter at twitter.com/roberthalf

2011 Hiring Outlook for Accounting and Finance

2010-12-21T12:42:00.000-08:00

2011 Hiring Outlook for Accounting and Finance

Companies that made deep cuts to their staff levels during the recession appear more likely to make selective hires of accounting and finance professionals in the coming year. Businesses are hiring not only to ease the burden on existing staff who have been shouldering extra workloads during the downturn but also to better position themselves for growth. To improve their ability to attract the best people for high-demand and hard-to-fill roles, some firms are demonstrating a willingness to modestly enhance compensation.

These and other trends are identified by Robert Half in the newly released 2011 Salary Guide. The guide forecasts that accounting and finance starting salaries will rise an average of 3.1 percent in the coming year, up from 0.5 percent as reported in last year’s guide. The Salary Guide lists average starting pay for nearly 300 positions in accounting, finance, banking and financial services.

Modest pay increases forecast for most management roles

If you’re a professional looking to pursue management-level employment opportunities in 2011, you can expect to find average starting compensation offered at most corporate and public accounting firms to be slightly above 2010 levels, the guide predicts. In the corporate accounting sector, for instance, directors of accounting at organizations of all sizes can expect average starting salaries to rise by between 2.3 and 3.1 percent.

Base salaries for senior-level roles such as treasurer and vice president of finance in corporate accounting are projected to rise less than 2 percent, but this does not take into account bonuses and incentives. Advanced degrees or professional certifications – such as the certified public accountant (CPA) and certified management accountant (CMA) – are also assumed at this level, and can increase average starting compensation by as much as 10 percent.

Tax services specialists hired for senior-level roles at large (more than $250 million in sales) or midsize public accounting firms ($25 million to $250 million in sales) could see starting compensation increase by as much as 3.9 percent over 2010 levels. Professionals joining large and midsize firms to serve in management services positions likely will earn 3 percent or more compared to last year, even for positions requiring only a year of experience. Compensation levels for senior-level tax accountants hired by large and midsize firms will experience some of the most significant increases, according to the guide – between 4.5 and 4.9 percent.

The projected 2011 salary ranges presented in this article are national averages. To calculate the approximate salary range for specific accounting and finance positions in your area and to download a copy of the newly released 2011 Salary Guide from Robert Half, go to http://www.roberthalffinance.com/salarycenter.

Future Leader Must-Haves

2010-11-03T06:58:00.000-07:00

Future Leader Must-Haves: Integrity and Communication Skills

Our company recently asked more than 1,400 chief financial officers (CFOs) what — besides technical and functional expertise — they look for most when grooming future leaders. By a wide margin, the top survey responses were integrity (33 percent) and interpersonal/communication skills (28 percent). Initiative came in third at 15 percent.

The plethora of news reports over the last few years spotlighting ethics violations within Wall Street firms and other organizations underscores the importance of leaders possessing a strong moral compass. Just one lapse in judgment can significantly damage a company’s reputation and bottom line. Understanding this well, executives are searching for up-and-coming accounting and finance professionals who are highly principled and forthright — and whom they can groom for leadership positions.

If you’re a new or mid-level manager looking to advance in your career and move up the corporate ladder, you’ll need to make integrity a core value, while also establishing honest and open two-way communication with employees. Integrity is not something than can be “learned,” only practiced, but there are a number of ways to enhance your communication skills with your staff that can prepare you for more senior leadership roles.

Consider these tips:

Be as transparent as possible. Treat your team as valued stakeholders by sharing information freely — and frequently. Keep them apprised of what you’re doing to keep your company or department strong, stable and on track. Share your thought processes so employees understand the logic behind key decisions and how staff members will be impacted.

Listen up. Effective communication involves more than just speaking and writing skills. If you’re only delivering information but not inviting it, you’re not making a real connection with your staff. First, make sure team members know it’s safe to voice their opinions, and then make it a habit of practicing active listening — truly paying attention to what someone is saying. Far too often, professionals at all levels are guilty of interrupting others while impatiently waiting for their turn to speak. Establish trust and goodwill by giving each employee you’re talking with your undivided attention.

Don’t leave people guessing. Providing crystal-clear communication on the front end goes a long way toward preventing costly misunderstandings later on. With this in mind, be as specific as possible, particularly with new members of your team who are trying to get a handle on how you operate. Help your employees help you by making your communication preferences known.

Submitted by Robert Half Finance & Accounting. Robert Half Finance & Accounting, a division of Robert Half International, is the world's first and largest specialized financial recruitment service. Robert Half Finance & Accounting is headquartered in Menlo Park, Calif., and has more than 350 locations worldwide and offers online job search services at www.roberthalffinance.com.

Recruiting/Retaining a Multigenerational Staff

2010-06-29T04:38:00.000-07:00

Post-Recession Tips for Recruiting and Retaining a Multigenerational Staff
The Great Recession impacted employees in many ways, including their attitudes about work itself. With at least three different generations now represented on teams at many companies, Robert Half International set out to assess each of their post-recession views. Our new white paper, Workplace Redefined: Shifting Generational Attitudes During Economic Change, reports on the findings. Here is a snapshot of what the survey found about how Gen Xers, Gen Yers and baby boomers characterize their priorities, perceptions and career plans. Also included are tips for addressing their concerns, which is likely to become increasingly important in recruiting and retaining key employees as conditions improve:

Competitive Compensation and Stability Appeal to All Ages
Baby boomers, Gen Xers and Gen Yers were in agreement when asked to name the most important factors they consider when evaluating a job offer. Salary, benefits and company stability topped each group’s list. Moreover, all three generations said “working for a stable company” and “having a strong sense of job security” are the work environment factors they value most.
Takeaway tip: When recruiting candidates from all generations, thoroughly spotlight your company’s competitive salary and healthcare/dental benefits. But don’t stop there. If your firm has a strong reputation and history of stability, emphasize those points, too. Economic turbulence has given workers a new appreciation for the relative stability of an employer.

A Sizeable Number of Employees are Looking to Leave
Many companies had to adopt a “do more with less” philosophy during the recession, and many still do. Employees were asked to take on a range of additional responsibilities, and, in some cases, salary freezes and/or pay cuts were instituted. When asked if they’re being fairly compensated for assuming heavier workloads, more than a third of all workers said no. This may be why 36 percent of Gen Yers, 30 percent of Gen Xers and 24 percent of baby boomers intend to seek job opportunities outside their firms if conditions continue to improve. Takeaway tip: Boost your retention efforts by making it clear that sacrifices made during the financial crisis will be rewarded as the economy picks up. As soon as possible, bring back popular benefits or perks such as bonuses, 401(k) matches or training opportunities that were cut or reduced.

Baby Boomers Rethinking Retirement
People plan to stay in the workforce longer because the need to rebuild their retirement funds. Fifty-four percent of baby boomers (and 46 percent of all employees) now say they’ll work beyond age 65.
Takeaway tip: Individuals who thought they’d soon be enjoying a leisurely retirement life will likely be attracted to flexible scheduling. To keep these highly skilled professionals motivated, consider offering them alternative work arrangements such as telecommuting options and shorter workweeks. You might also offer transitional consulting roles to top soon-to-be retirees. It’s a win-win scenario: They earn money and you retain their invaluable institutional knowledge.

Submitted by Robert Half Finance & Accounting. Robert Half Finance & Accounting, a division of Robert Half International, is the world's first and largest specialized financial recruitment service. The company has more than 360 offices worldwide, and offers online job search services at www.roberthalffinance.com.

Post Recession Leadership Strategies

2010-05-17T13:56:00.000-07:00

Help Wanted: Hiring Tips for Small Businesses

During what many are now calling the “Great Recession,” small business leaders were often forced to focus solely on just keeping their companies afloat. Consequently, quick-fix staffing solutions may have been implemented. As the business cycle shifts toward more positive ground, now is the time to re-evaluate your staffing situation so that your company is positioned for growth. Success hinges on knowing both when and whom to hire. Following are tips based on our company’s new booklet, Post-Recession Leadership Strategies: A Small Business Guide to Hiring, Managing and Retaining Staff:

Recognize When It’s Time to Add Personnel
After making tough staffing decisions during the downturn, no business wants to over hire. But how do you know when it’s time to start slowly rebuilding your team? Beyond feeling chronically short-staffed, there are other signs that you may need to bring more personnel aboard. They include:
· An overload of overtime. Your employees frequently need to put in extra hours to complete their work. Remember that if you’re not paying proper attention to staffing, your overtime costs can run more than a full-time salary.
· Burnout. Staff members show signs of fatigue and stress, including missed deadlines, more errors, decreased morale and increased absenteeism.
· Constant firefighting. Important projects are repeatedly deferred in order to put out more pressing fires.
· All hands must be on deck at all times. The absence of just one person throws your entire team off schedule.

Look for Specific Traits and Abilities
Small companies need power players — talented people who can fulfill multiple roles, balance an array of duties and be comfortable with fluid job descriptions. Whether you seek accounting professionals for full-time, part-time or temporary positions, there are some key traits to look for in candidates. Those who thrive in small business environments typically possess:
· An entrepreneurial spirit: They apply creative and innovative thinking to realize strategic business goals.
· A team-oriented attitude: They have history of working collaboratively, constructively and cooperatively with others.
· Complementary personality: They adjust easily to the corporate culture and maintain an optimistic mindset.
· Customer-service focus: They are personable and able to provide superior service and support to clients, customers and other stakeholders.
· Commitment and engagement: They show interest in and commitment to the “big picture,” understanding the link between individual effort and the group’s success.

Robert Half Finance & Accounting, a division of Robert Half International, is the world's first and largest specialized financial recruitment service. Robert Half Finance & Accounting is headquartered in Menlo Park, Calif., and has 360 locations worldwide. To request a copy of “Post-Recession Leadership Strategies: A Small Business Guide to Hiring, Managing and Retaining Staff,” please visit www.roberthalf.us/smallbusinessseries.

Fair Value - Fair or Foul

2010-03-26T16:24:00.001-07:00

SFAS 157 – Fair or Foul After Year One?

Michael R. Jordan
August, 2009

The Fair Value, or so called “Mark to Market,” debate continues to rage, even though application of Statement of Financial Accounting Standards No. 157 (SFAS 157), Fair Value Measurements was required back in 2008. Financial guru Steve Forbes, former General Electric Chairman Jack Welch and now the United States Congress are all on record criticizing “mark to market” accounting and implicating it as a culprit in the collapse of the financial sector. Think of it, a change in accounting guidance has brought the world to its knees. We accountants must be a pretty powerful group! Would that we could end armed conflicts by using similar means. Of course, we all know there is plenty of blame to go around for the current economic state of affairs.

What is the present status of fair value accounting?

The truth is, “Fair Value” is nothing new. Accounting Principles Board Opinion No. 18 (APB 18) was issued in 1971 and it refers to fair value. SFAS 157 did not require any new fair value measurements, nor change any previous guidance that require or permit fair value measurement. The real change was defining fair value as an “exit price.” When an asset is acquired or a liability assumed, that transaction price represents an “entry price.” When an asset or liability is disposed of or transferred, that transaction is referred to as an “exit price.” If you think about it, entry prices and exit prices can be very different, just as bid and ask prices can be. This one change in concept has caused about as much tumult in the accounting world as the issuance of SFAS 133, Accounting for Derivative Instruments and Hedging Activities did back in 1998.

There are numerous arguments against fair value accounting. One such argument says that market prices do not always reflect the economic substance of a transaction, especially for assets held to maturity. This is actually a very common situation. For example, assume I have a U.S. Treasury security that pays a coupon interest rate of 1%. For at least the past year, market rates on these securities have been in the 5% to 7% range and, in management’s opinion, these interest rate levels will continue for the foreseeable future. Based on the SEC Staff Accounting Bulletin No. 59 (SAB 59), this security could very well be “other-than-temporarily impaired” and should be written down. I am sure that anyone holding a Treasury security fully expects to receive their total principal and all interest payments at the agreed upon rate of return in a timely manner. Has the economic substance of the security changed just because of a change in market interest rates? You be the judge.

A related viewpoint is that fair value is simply a form of liquidation accounting. If the company is marked to market, this is equivalent to the amount that would be received today to sell off all assets and settle all debts (we won’t get into fair value determination for liabilities, that’s an issue the Financial Accounting Standards Board (FASB) is still struggling with). To carry this full circle, if Company A is marked to liquidation value, then Company B transacting with Company A will eventually be forced to mark their Company A asset down to liquidation value. Then Company C transacting with Company B will have to take a markdown, and so on. You can almost visualize the dominoes falling if you think about the financial sector over the past year or so.

In countering these arguments, you’ve probably heard or read the statement that fair value is the most relevant measure for financial instruments. Measures, other than fair value, are not typically indicative of the effect current economic conditions have on an entity’s financial position. By providing new fair value guidance, financial reporting was to be more transparent. Other than the “exit price” notion, SFAS 157 was very much about developing and standardizing disclosures. As the hierarchy level goes up, the disclosure requirements increase. That does not necessarily mean a Level 3 valuation is any less valid than a Level 1 or 2. In fact, more work and thought and cost probably went into generating those (hopefully reasonable) valuations than the other two levels combined. Level 1 valuations are easy, right? Additionally, the attendant disclosures for each level would tend to maximize transparency, especially for those hard to value instruments.

Assumptions About Assumptions

But, believe it or not, fair value was never intended to be an automatic “mark to market” valuation, though it seems many interpreted it that way. How do I know this? Well, here are a few tidbits that are dead giveaways.

Right out of the gate, SFAS 157 muddies the water with “The transaction to sell the asset or transfer the liability is a hypothetical transaction at the measurement date, considered from the perspective of a market participant that holds the asset or owes the liability.” Any hypothetical transaction will necessarily involve a hypothetical price. There is nothing to base a price on but estimates, since the holder did not actually transact. Let’s face it, on many exchanges, even closing prices for actively traded instruments are derived from numerous transactions and are themselves, estimates.

Second, SFAS 157 states that: “A quoted price in an active market provides the most reliable evidence of fair value and shall be used to measure fair value whenever available.” This seems to be a reasonable premise given the market based approach to asset and liability valuation. However, what exactly is an active market? Generally, there are plenty of transactions such that reasonable market prices can be found through available trade information. Liquidity premiums are normally quite low and default premiums are consistent with the credit quality of the borrower. These attributes don’t always hold true in inactive markets.

Third, fair value is defined as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” The Free Dictionary (www.thefreedictionary.com) defines order as: “A condition of methodical or prescribed arrangement among component parts such that proper functioning or appearance is achieved.” This definition seems to describe many of the markets we are most familiar with, in normal times. However, we all know there has been a great deal of market disruption and the term “orderly” is not one I would use to describe a number of markets lately.

Fourth, SFAS 157 provides for three valuation techniques to determine a fair value. They are the cost approach, the income approach and the market approach. If fair value was intended to be solely “mark to market,” the FASB would not have included the cost and income approaches.

Lastly, my favorite quote from this guidance is contained in paragraph 30 which states: “unobservable inputs shall reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability.” You read that right, assumptions about assumptions. Instead of a verifiable historical transaction, we may now use, not just assumptions, but assumptions about assumptions to value balance sheet items. You can’t get much further from a true market price than that.

An Example of the Dilemma

So, let’s look at an example of something many have faced over the past year (Table 1). Suppose I have an investment grade mortgage security with a face value of $100 that pays a coupon rate equal to LIBOR which is currently 5%, plus a 2% premium, or 7%. For simplicity sake, assume that a 1% change in interest, or discount, rate results in a $1 change in the security’s price. That will make it easier to relate rate of return to price. Research has shown that a normal liquidity premium in this market is around 2%, hence the premium being received above. I have recently determined, using the income approach and a beautiful mathematical model, that I will probably collect only 75% ($75) of my investment amount because of the deteriorating credit quality, or default risk, of the underlying mortgages. If the market has similar information, I should be able to sell that security for around $75 or a 32% discount relative to the total contractual cash flows (5% LIBOR + 2% Liquidity premium + 25% Default premium). I have been able to find two trades in very similar securities during the last quarter and they were both in the $25 range. That translates into an 82% discount rate relative to the total contractual cash flows (5% + 2% + 75%). If the market has become so inactive that the liquidity premium doubled to 4%, and that is a quite severe premium, what is the rationale for the additional 50% in discount? (82% - 25% - 5% - 2% = 50%) It appears the current market has become not only inactive, but completely uncoupled from the underlying economic and financial risk and return metrics of 5% for LIBOR, 4% for liquidity and 25% for default risk, or 34%. This is one of those instances where you might hear the term “market dislocation.”

Table 1.

	Purchase Price and Contractual Rates	Price Adjusted for Additional Default Risk	Price Adjusted for Additional Liquidity Risk	Price Seen for Market Transactions
Price	$100	$75	$73	$25

LIBOR	5%	5%	5%	5%
Liquidity Premium	2%	2%	4%	2%
Default Premium	0%	25%	25%	25%
Panic Premium				50%
Total Discount Rate	7%	32%	34%	82%

What is the additional 50% attributable to?

I don’t have an answer to that, a “panic premium,” maybe. But this is the kind of illogical pricing information investment holders had to deal with. Some markets became quite illiquid as demand dried up, but an additional 50% liquidity premium is not sensible. If you remember, the dot com boom resulted in market values in the opposite direction. Models using then current risk and return metrics could not approximate the very high prices seen in the market. Could it be that markets truly are not rational?

Audit Fears Come to Fruition

It’s very difficult to prove a point using a “lack of information” as your support. Have you ever tried to adequately document an inactive market? It’s nearly impossible. Proving that transactions in that market are distressed is equally challenging. One reason the original exposure draft of FASB Staff Position (FSP) FAS 157-4 presumed that transactions in inactive markets were distressed, unless they could be proven otherwise, was to help address that quandary. Because of this difficulty, some accounting firms were uncomfortable with clients designating markets as inactive even though the press, the government and the markets themselves continuously bombarded media channels with the fact that markets were inactive, distressed and dislocated. This effectively precluded the use of Level 3 valuations and in some cases Level 2.

We accountants know enough about finance to be dangerous. (Of course, some might say we know enough about accounting to be more than dangerous.) Many accounting firms utilized financial experts to assist in the implementation of the new fair value guidance. A number of these experts hailed from Wall Street. Firms leveraged this real world expertise to evaluate the pricing techniques clients were using. The problem here was that many of these financial minds perceived the valuation measures through purely market colored glasses. They didn’t fully understand the nuances of the accounting guidance and some auditors didn’t really understand all of the complex finance. Clients were also struggling to interpret and ultimately explain the bizarre risk and return metrics implied by the markets. This triad of communication channels, between auditor, client and expert, was filled with so much static it could not all be filtered out. The consequence was a number of severe impairment write downs of Held to Maturity and Available for Sale investments, some because of this miscommunication and resulting misapplication of the fair value guidance. In the end, conservatism, not neutrality, ruled the day.

FASB to the Rescue

To address all of the misunderstandings, FASB was forced to issue two additional clarifications, FSP FAS 157-3 on October 10, 2008 and 157-4 on April 9, 2009. These two FSPs provided examples and checklists for determining if a market is inactive and if transactions in that market are orderly. (How is that for getting away from rules based accounting? Maybe we are not ready for the principles based approach of International Financial Reporting Standards (IFRS)). Audit firms and their clients now have specific guidance to follow in their fair value determinations and impairment evaluations.

Will this reduce the impairment write downs we’ve been seeing?

Originally, SFAS 115, Accounting for Certain Investments in Debt and Equity Securities, required an other-than-temporary impairment be recognized as a loss in the income statement if the loss was probable. The loss equaled the difference between fair value and carrying value. The amendments to SFAS 115, which accompanied FSP FAS 157-4, require that only the credit, or default, portion of an other-than-temporary impairment be recognized net as a loss in the income statement, if the holder does not intend to sell. The loss, however, no longer has to be probable. Holders must now develop their best estimates of credit, or default, losses on all securities that meet their criteria for other-than-temporary impairment, which is no small task. This is in addition to the fair value measurements already required. We may end up seeing fewer large impairment charges and many more, but smaller, credit loss charges. What the total dollar value of these write downs will be remains to be seen.

Along with these clarifications, FASB provided additional guidance in the form of FSP FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments, which was also issued in April. While a modest five pages long, it may significantly expand disclosures for some companies. In essence, fair value disclosures for financial instruments within the scope of SFAS 107 must now be included in the interim financial reports, rather than just annual reporting, of all public companies. Here again, the FASB felt that increasing the frequency of these disclosures would increase transparency by providing more timely and robust information to financial statement users.

Onward to Year Two

After some of the fits and starts we looked at, it appears this fair value thing may just survive the onslaught of critics. And after reading some of the comment letters on the recent FSP exposure drafts condemning FASB to the nether regions, that is probably saying something. It may be that this was the perfect economic environment to test it out, to shake out many of the bugs. Also, it doesn’t look like we’ll end up with anything like that 600 page “Green Book” of Derivatives Implementation Group (DIG) Issues, as we did with SFAS 133.

Already in the works are additional tweaks to the guidance, particularly in relation to the valuation of liabilities, and discussions on expanding the use of fair value in financial statements. But a number of industry groups still feel the principle is flawed. All in all, I believe we accountants have become a little more comfortable with this new conception of fair value, as have the users of the financial statements we produce. But I also think we will probably need some additional education in finance to further our understanding of how financial instruments can be valued. The good thing about this is we will be supporting colleges and universities that need it, providing jobs for teachers and contributing to the next economic upturn and resulting market rally!

To wind this up, 2009 brings with it the addition of certain nonfinancial assets and liabilities to the SFAS 157 domain. Generally, these will include assets and liabilities in a business combination, those tested for impairment under SFAS 142, Long-Lived assets, Asset Retirement Obligations and Exit or Disposal Activities. Their inclusion will add some new complications to the current valuation processes being employed. Some of them will have observable trading markets, though they may not be active. I suspect the predominance of valuations will involve discounted cash flow models, the income approach, and appraisals or replacement cost estimates, the cost approach. Given the experience we now have with financial instruments, hopefully this next round of fair value measurement implementation will go more smoothly.

Hiring Managers: Know How to Negotiate Salary - Kim Shark

2010-02-25T08:02:00.000-08:00

Know How to Negotiate Salary

After tendering a job offer, employers should be prepared to negotiate the compensation package should the candidate request an adjustment. Job seekers today have access to an abundance of information on salary negotiation through websites and books, so many will attempt to negotiate your offer and will enter the meeting knowledgeable on the topic. To reach a fair deal, you need to be equally prepared.

The first step is not unlike that in any other sort of bargaining. If the candidate suggests a higher figure than you’ve offered, you can choose to raise the amount of your proposal, waiting for the candidate to respond or counteroffer, and, ideally, arriving at an agreement that’s within the salary range you’ve set for the position.

If the candidate keeps pushing, whether you want to exceed the established range generally depends on two factors: one, how badly you want the individual; and two, the policies and precedents in your company. Two questions to ask yourself before you move forward:
· Are other, equally qualified candidates available if the applicant says no? If the answer is yes, the leverage to make accommodations rests with the company.
· Has the job been particularly hard to fill, or are market conditions making finding and recruiting suitable candidates difficult? If the answer is yes, the leverage rests with the candidate.
· Will a stronger offer be significantly out of line with existing pay levels for comparable positions in your company or hiring manager’s department? Recognize that if you decide to go beyond the firm’s pay scale to win a really stellar candidate, you risk poor morale among existing staff should they learn that a new hire in the same role is being paid at a higher rate. And the best-kept secrets often do get out.

If you’re not able to match a candidate’s salary request, consider expanding other components of the package. Applicants are often willing to compromise on base compensation if concessions are made in other areas. Flexible scheduling is one candidate-pleasing option that will cost you little to nothing. Providing additional time off or opportunities to telecommute may also be acceptable to a candidate in lieu of higher wages.

Don’t get so caught up in negotiations that you lose sight of what is appropriate for your organization. Sometimes you just have to walk away. If your attempts to woo a reluctant candidate fall short, the best thing to do in many cases is to cut your losses and look somewhere else. The goal at this point should be to end the process so that the candidate leaves with a feeling of being treated fairly and with dignity. If carried out effectively, though, your salary negotiation has a very good chance of ending on a positive note.

Submitted by Robert Half Finance & Accounting. Robert Half Finance & Accounting, a division of Robert Half International, is the world's first and largest specialized financial recruitment service. The company has more than 360 offices worldwide and offers online job search services at www.roberthalffinance.com. Follow Robert Half Finance & Accounting on Twitter at twitter.com/RobertHalfFA.

Working Smarter: Tactics to Increase Your Team’s Efficiency

2010-01-13T14:04:00.000-08:00

Working Smarter: Tactics to Increase Your Team’s Efficiency
Is boosting productivity one of your New Year’s resolutions? If so, now’s the time to root out inefficient and outdated practices that no longer work. Use the following tips to help increase the quantity and quality of your team’s output in 2010:
Reevaluate routines. All too frequently, tasks and procedures are hastily stitched together when a need arises, and that approach then becomes the “way it’s done” regardless of how effective it is. Take the time to look under the hood and question the status quo, keeping a constant eye on working smarter. Be on the lookout for common inefficiencies such as duplication of work and unwarranted layers of approval. Whenever possible, streamline and consolidate functions, making sure your top performers are tackling high-priority duties that contribute to the bottom line.
Avoid meeting mania. Meetings are often needed to accomplish key goals. But they can also be huge time wasters if managed improperly. In a recent survey by Robert Half, senior executives said that almost a third of meetings they attend are unnecessary. Moreover, 45 percent of respondents felt employees would be more productive if their organization banned meetings one day a week. Before calling a meeting, carefully consider whether it’s absolutely essential. If you have no significant updates and everyone is facing heavy workloads, why have the weekly staff gathering? And remember that when calling a meeting it’s important to invite only those individuals who truly need to be in on the discussion. Also, stick closely to the agenda, watch the clock and quickly rein in tangential conversations.
Promote (and practice) good time management. If you’re operating with fewer staff members, it’s all the more critical that your employees use their time well. Impress upon all your accounting professionals the importance of looking at the big picture and prioritizing their assignments accordingly. Being focused and well organized yourself will help set the tone for your staff. Regularly review your to-do list, be willing to delegate, and budget time for those unexpected but inevitable interruptions.

Submitted by Robert Half Finance & Accounting. Robert Half Finance & Accounting, a division of Robert Half International, is the world's first and largest specialized financial recruitment service. The company has more than 360 offices worldwide and offers online job search services at www.roberthalffinance.com.

Reining in Rumors: How to Effectively Manage Office Gossip

2009-11-18T11:26:00.000-08:00

Reining in Rumors: How to Effectively Manage Office Gossip
Kim Shark, Recruiting Manager - Robert Half Finance & Accounting

Psst…Did you hear the news about gossip in the workplace?

According to a survey by Robert Half International, 84 percent of executives said it’s common for employees to engage in office gossip, and nearly two-thirds (63 percent) said it has a negative impact.

Indeed, rampant rumormongering can damage your team’s morale and productivity by stoking unfounded anxiety, creating confusion and stirring up friction. Following are tips on managing gossip:

Share information as quickly as you can. Frequently providing clear and candid communication is the best way to keep gossip in check. Don’t drag your feet when it comes to sharing relevant news with your accounting staff. Remember: When changes are clearly afoot and you don’t offer any insights, the office grapevine will fill the void with speculation. (Also, be mindful that employees can develop wild imaginations when they feel shut out.)

Stay in regular contact. Maintain an open-door policy, but also be proactive and check in with your team members from time to time. Casual chats allow you to get a handle on office undercurrents and find out how people are feeling and what they are worried about.
Don’t let one bad apple spoil the bunch. If there’s an individual employee who continually creates problems by spreading misinformation, don’t shy away from addressing the issue with the person one-on-one. And be quick to publicly correct potentially damaging half-truths by providing accurate and up-to-date clarifications.

Keep your cool. The higher you are in the organizational hierarchy, the more likely you are to be an occasional topic of discussion. So, as a manager, you’re bound to be the subject of some watercooler chatter. Hearing of these kinds of comments can be a two-edged sword. On the one hand, you can set the record straight on comments made about you personally when you absolutely need to, but it’s generally best to remain calm, cool and collected, while doing your best to develop a tough skin. That said, if you pick up criticisms of your management style that could be constructive, consider them as valuable input for improving your approaches or policies.
Lead by example. Practice what you preach. Don’t speak in hushed tones or criticize the decisions of those above you. In short, don’t say anything about people that you wouldn’t say in front of them.

For more advice on management and career issues, listen to The Management Minute, Robert Half’s podcast series at www.rhi.com/podcast.

How to Strengthen Your Talent Bench in any Economy

2009-10-01T11:39:00.000-07:00

How to Strengthen Your Talent Bench in any Economy

As tough as this economic environment may be, it also presents opportunities for prudent yet forward-looking companies. Layoffs and hiring freezes have put many top-notch people out of work, which means this can be an opportune time to acquire highly skilled performers who would be harder to recruit — or unavailable — in sunnier times.

Still, this doesn’t mean the best professionals are easy to find. Despite high unemployment rates across the United States and an expanded pool of available talent, employers interviewed for the Robert Half International and CareerBuilder.com 2009 Employment Dynamics and Growth Expectations (EDGE) Report said that, on average, 44 percent of resumes they receive are from unqualified candidates. If your company would like to pursue this unique opportunity to strengthen its talent bench, consider these cost-effective strategies for locating the best accounting professionals in the job market:

Use in-house connections. Even with tight budgets, it’s smart to continue (or start) offering employee referral bonuses. These high-reward, relatively low-cost programs give team members strong incentive to be on the lookout for candidates who’ll fit in well at your firm. Ask employees to keep their eyes and ears peeled for talented friends, business associates and former classmates who are now available.
Keep in contact. The grass isn’t always greener on the other side. That’s why it pays to stay in touch with team members who’ve left your firm. There are many benefits to rehiring strong performers. “Boomerang employees” have a proven track record and possess invaluable insight into your company. This knowledge minimizes training expenses and ramp-up time, enabling them to make significant contributions quickly.

Connect with a staffing specialist. According to the EDGE Report, it can take up to 14 weeks to fill an open position. Recruiters specializing in the accounting field can shorten that timeline by tapping into their well-cultivated networks. An experienced and reputable staffing firm also can help you by conducting initial interviews, skills evaluations and reference checks.

Finally, go on re-recruiting missions. While you’re strengthening your talent bench, don’t forget the talent you already have. Your best and brightest are in demand in any economy. Be proactive and sell your stars on their employment with your firm before you lose them to competitors. Ask about their career aspirations and consistently direct them toward opportunities or programs that will help them reach their objectives. Frequently offer gratitude for standout work and present them with a clear vision of their bright future with your organization.

To download the EDGE Report, please visit www.rhi.com/EDGEReport2009.

Founded in 1948, Robert Half Finance & Accounting is the world's first and largest specialized financial recruitment service. The company has more than 360 offices worldwide and offers online job search services at www.roberthalffinance.com.

Management Mistakes to Avoid in an Uncertain Economy

2009-06-12T05:21:00.000-07:00

Management Mistakes to Avoid in an Uncertain Economy

While the current economic downturn is in many ways unprecedented in its scope and severity, accounting leaders can still learn from missteps other managers have made in previous recessions. Robert Half International’s recently released guide The 30 Most Common Mistakes Managers Make in an Uncertain Economy discusses a number of problematic pitfalls to avoid.

Here are three of them:

Thinking your team can’t handle the truth. Frequent communication with employees is always integral to success. But providing clear, candid and timely information is especially critical during hard times for businesses. Tell your team as much as you can as soon as you can. It’s when workers feel blindsided by announcements of layoffs, salary freezes, pay cuts, mergers and other changes that trust and motivation plummet. Provide a big-picture overview of your firm’s situation. Is the company restructuring to save jobs? Will priorities shift significantly? How did the firm survive previous downturns? Describe what, if any, changes are on the horizon, and how employees will be affected. Encourage questions and let your staff know you’ll keep them in the loop.

Cutting training programs. Though they are often among the first areas to be cut, consider the ramifications carefully before slashing professional-development budgets. Skimping on employee educational programs can dull your competitive edge, and undermine your recruitment and retention efforts. The key is to recognize that there are myriad ways to support the professional growth and education of your team. Mentoring programs, e-learning and in-house training sessions are just a few cost-effective options.

Feeling that employees are lucky just to have a job. This assumption is based on a belief that when the economy is weak, people wouldn’t dare consider leaving. As a result of this thinking, some managers figure they can let their retention efforts slip. The truth is, while workers may be happy and appreciative to have stable positions, you can’t afford to take them for granted. Talented accounting professionals are marketable in any business climate. If you want your top performers to stay with your firm over the long term, continue to offer whatever incentives you can and frequently recognize them for their outstanding contributions.

Submitted by Robert Half Finance & Accounting. Founded in 1948, Robert Half Finance & Accounting, a division of Robert Half International Inc., is the world's first and largest specialized financial recruiting service. Robert Half Finance & Accounting is headquartered in Menlo Park, CA, and has more than 360 locations worldwide.

To order The 30 Most Common Mistakes Managers Make in an Uncertain Economy, please visit www.rhi.com/30Mistakes.

How to Choose Between Two Equally Qualified Candidates

2009-03-31T07:14:00.000-07:00

How to Choose Between Two Equally Qualified Candidates
You posted a job opening and received countless applications. You diligently reviewed a towering pile of resumes, went through the time-consuming task of interviewing the most promising individuals and narrowed the field down to two exceptional accounting professionals.

The problem? You can’t decide whom to choose because both candidates meet your criteria and possess similar experience. While it’s an enviable staffing-related problem to have, particularly during a recession, the situation still makes for a difficult hiring decision. Following are tips to consider and additional questions to ask to help you identify the person who’s truly best suited for the job:

Look beneath the surface. Ask both candidates back for follow-up interviews so you can dig deeper. Engage them in conversations that provide more insight into their personalities, workstyles and critical-thinking skills. Consider asking open-ended questions such as, “Describe a politically sensitive situation in your former workplace and how you resolved the problem,” or “What was your biggest professional setback and how did you handle it?” Frequently, what distinguishes outstanding employees is the ability to solve dilemmas and learn from their mistakes.

Put a spotlight on people skills. In today’s challenging economic environment, any new hire should possess strong technical skills and a bottom-line focus. But because so much business today is founded on collaboration, it’s also wise to focus on less-tangible qualities such as interpersonal abilities. Try to identify the person who possesses the stronger team-building and communication skills. Helpful questions might include: “Tell me about a time when you successfully sold a bold new idea to management,” or “Describe a project involving multiple departments and how you coordinated everyone’s efforts to achieve the same goal.”

Closely examine their excitement level. Which person displays more enthusiasm about the job opportunity and passion for the accounting field? Upbeat applicants who demonstrate eagerness to learn, grow and tackle new challenges will likely bring the same initiative and positive attitude to their jobs. Ask questions such as, “How do you keep your skills current?” to gauge the candidate’s career ambitions and commitment to professional development.

For more advice on management and career issues, listen to The Management Minute, Robert Half’s podcast series at www.rhi.com/podcast.

Submitted by Robert Half Finance & Accounting. Founded in 1948, Robert Half Finance & Accounting, a division of Robert Half International Inc., is the world's first and largest specialized financial recruiting service. The company has more than 360 offices worldwide and offers online job search services at www.roberthalffinance.com.

Staffing Challenges in Uncertain Times

2009-02-26T14:00:00.000-08:00

The Benefits of Flexible Staffing

The economic downturn has created a shortage of many things, but staffing challenges aren’t one of them. Today’s uncertain business environment means accounting and finance managers need to be thoughtful about every personnel decision they make. Hiring the wrong people or hastily cutting staff levels too deeply can jeopardize quality and service levels, leaving clients disappointed when you need them the most.
One way to ensure that your workforce size remains in line with customer demand is to augment your full-time team with well-chosen interim professionals. Temporary staff can help you address unforeseen workload fluctuations by providing assistance on time-sensitive projects that demand immediate attention. Moreover, adopting a flexible staffing strategy enables you to easily expand or contract personnel levels with minimal disruption as business ebbs and flows. Here are some additional advantages of flexible staffing:

You’ll save money. You’ll turn some of your fixed costs into variable expenses by paying only for the human resources you need when they’re truly needed, not year-round. You can minimize overtime expenses and lower the high costs associated with hiring, training and keeping employees on board.

You’ll save time. Whether you’re hiring for a full-time role or a mission-targeted temporary position, staffing firms can offer valuable assistance. Firms that specialize in accounting and finance staffing are experts on your local market, and they can save you time and resources in your search. Remember that it’s not the hourly rate of the assignment that matters most but the overall cost of the project. Businesses can save money in the long run using a first-rate staffing firm because a higher quality candidate will finish the job more quickly and with greater accuracy.

You’ll keep burnout at bay. Most companies today are having to ask staff to do more with less. But if employees are stretched too thin for too long, you’ll notice a drop in morale, productivity, innovation and overall work quality. Bringing in temporary professionals to tackle highly specialized assignments or day-to-day responsibilities helps take the burden off your staff, freeing them up to focus on the most pivotal projects. As a result, you’ll bolster retention of your core employees – especially important in preparing for when conditions begin to improve and your best people may be tempted by other opportunities.

For more advice on management and career issues, listen to The Management Minute, Robert Half’s podcast series at www.rhi.com/podcast.

Submitted by Accountemps. Accountemps is the world’s first and largest temporary staffing service specializing in the placement of accounting, finance and bookkeeping professionals. The company has more than 360 offices nationwide and offers online job search services at www.accountemps.com.

Teleconference Meeting - Tips

2009-02-10T04:27:00.000-08:00

Teleconference Meeting Tips -
Kimberly Shark, Robert Half Finance & Accounting

The use of teleconferences is increasing as companies tighten travel budgets. When moderated effectively, teleconferences enable geographically dispersed professionals to quickly touch base to share information and make important decisions. But poorly planned and unstructured conference calls waste valuable time. Following are tips on managing these meetings:

Plan ahead. After deciding which individuals truly need to be in on the call, send participants an e-mail noting the date and time of the meeting. (Be sure to include the time zone.) It’s also wise to mention the topics to be covered, the desired outcome and the expected duration of the meeting. If you’re using a dial-in option, remember to provide number and the access code.

Play the name game. At the outset of the teleconference, conduct a roll call by asking participants to introduce themselves. To minimize confusion later on, remind people to identify themselves each time they comment.
Focus, focus, focus. It’s the moderator’s job to keep participants on track. Tactfully redirect the discussion if tangential banter, crosstalk or a long-winded accounting colleague is overtaking the meeting.

Offer verbal cues. Unless you’re using videoconferencing equipment, people can’t see your expressions and body language. While nodding and smiling are effective in face-to-face meetings, teleconferences require you to make your voice heard. A simple, “Yes, I understand” or “I see your point” can go a long way toward aiding the flow of the conversation.

Beware of background noise. Whether you’re facilitating the conference call or not, display good etiquette by resisting the urge to multitask. In short, don’t peck on your keyboard, shuffle papers or eat a snack during the meeting. While teleconferencing technology has made advances in allowing participants to better hear and be heard, these seemingly innocent activities are magnified by teleconferencing equipment.

Watch the clock. Respect people’s time by adhering to your original schedule. If it’s approaching the ending time and there’s still ground to cover, set aside the last few minutes to schedule a follow-up meeting.

Submitted by Robert Half Finance & Accounting. Founded in 1948, Robert Half Finance & Accounting, a division of Robert Half International Inc., is the world's first and largest specialized financial recruiting service. Robert Half Finance & Accounting is headquartered in Menlo Park, CA, and has more than 360 staffing locations in North America, South America, Europe and the Asia-Pacific region.

Succession Planning - Kim Shark, Robert Half Finance & Accounting

2009-01-14T07:29:00.000-08:00

Successful Succession Planning
“Planning is bringing the future into the present so that you can do something about it now.”
— Alan Lakein, author

If you’re one of the many baby-boom-age accounting and finance managers planning to retire in the next few years, have you thought about developing a succession plan? Surprisingly, few financial leaders have taken this prudent step. A majority (83 percent) of chief financial officers polled in a recent Robert Half International survey say they have not identified a successor for their positions.

Succession planning might seem like a low-priority endeavor during tough economic cycles, but it’s critical to prepare for contingencies — and protect your organization’s future — now. By training a protégé to fill your shoes, you’ll ensure a smooth transition and provide much-needed stability to your department during times of change. Here are some succession-planning tips:

Know what you’re looking for. The first step is to identify and prioritize the professional and personal qualities you consider most essential for success in your role. Your goal should be to identify a promising up-and-coming employee who has the potential to hone the full range of skills and abilities necessary to perform your job.

Offer exposure. Once you’ve identified your would-be successor, introduce him or her to situations and assignments common in your position. No matter how talented and sophisticated the protégé, professional development in advance of assuming the new role is key. For instance, you might boost the person’s visibility by encouraging him or her to tackle some high-profile responsibilities, such as reengineering an important business process or giving presentations to the company’s board or an important client.

Embrace mentorship. As your protégé wrestles with real-world management challenges, provide plenty of behind-the-scenes coaching and feedback. And be sure to facilitate the transfer of not just nuts-and-bolts insights for performing certain tasks and managing projects, but also the less-tangible institutional and “insider” knowledge you’ve acquired over time. Set regular dates to assess your protégé’s progress and offer your support as he or she gains the confidence and expertise necessary to lead the department or organization.

For more advice on management and career issues, listen to The Management Minute, Robert Half’s podcast series at www.rhi.com/podcasts. Submitted by Robert Half Finance & Accounting. Robert Half Finance & Accounting, a division of Robert Half International Inc., is the world's first and largest specialized financial recruiting service. The company has more than 360 offices worldwide and offers online job search services at www.roberthalffinance.com .

What Is The Carolinas Council?!?

2008-12-18T16:35:00.000-08:00

The Carolinas Regional Council (later Carolinas Council) was founded in 1971 when there were nine local Chapters in the two Carolinas with approximately 2,000 members. Chartered in 1975, it was the first Council formed of the twenty-four within the National Association of Accountants (NAA) which we now know as the Institute of Management Accountants (IMA).

It is also one of the most active and successful Councils in the world, winning the Council Award of Excellence in numerous years. All IMA members and Chapters in the region are members of the Carolinas Council.

The Council’s purpose is to further the objectives of IMA and its members, to promote and facilitate cooperation and communication between Chapters and Councils, and to provide a means to pool resources and assist Chapters. Participation in the Carolinas Council also provides Chapter members an opportunity for national service.

The Council elects one of its members to represent its interests on the IMA National Board of Directors. It also selects members to serve on various IMA national committees. Currently, Wayne Ledbetter, of the Columbia Chapter, is Regional Vice President representing the Chapters and Council at the national level of IMA. Another Council member, also from the Columbia chapter, John M. Brausch, CMA, CFM, CPA is Chair Elect for the entire IMA organization! These “volunteer” endeavors take time and dedication and we appreciate the work of all of our volunteer leaders!

The Council also sponsors continuing education programs, including its signature Annual Spring Conference. The first conference was held in the fall of 1974 and was a rousing success. It has been held each spring since that time in beautiful Myrtle Beach, SC. This year’s conference will be April 30-May 2nd. This conference provides 16 hours of top notch, NASBA registered, continuing education and numerous networking opportunities, not to mention the sun and fun of the beach! There are also two other educational opportunities, one in the fall and one in the winter, sponsored by Chapters and the Council.

As an additional service to Chapters, the Council can sponsor CPE credits under its NASBA registry at qualifying Chapter hosted events. Under its Chapter Partnering Program, the Council may also loan seed money to Chapters to get a qualifying event off the ground and promote additional educational opportunities for the membership. The Council is also investing in a new website and on-line registration system that will provide integrated, easy to use, event management and reporting capabilities for Council and participating Chapter programs.

Kinsey Jenkins served IMA in many different areas during his 28 year membership. He has been a long-time volunteer leader in the Columbia Chapter and the Carolinas Council, and a professional leader in the IMA national organization. Whenever there were questions, the volunteer leaders in IMA worldwide always knew that they could depend on Kinsey Jenkins to provide answers. Kinsey understood the importance of Chapters and Councils and he dedicated his entire IMA career to serving their members.

It is appropriate that the Council recognize the volunteer service of its current and future leaders. To that end, IMA Carolinas Council presented the first annual Kinsey Jenkins Service Award at its fall meeting on October 26, 2007. Peggy Reeves of the Spartanburg Area Chapter was the inaugural recipient. On October 25th of this year, Ev Walker was recognized for his many years of service to IMA as the second recipient of the award.

Each IMA Chapter selects delegates to the Council but all IMA members are welcome and encouraged to attend Council Board meetings.