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Five key elements of a successful investor pitch by the CFO

From Creating a message that resonates with private equity investors or other suppliers of private capital requires more than a nice-looking PowerPoint. It means understanding the investor’s mindset. Investores are primarily focused on getting their original investment back (plus a return, naturally) after it’s been used to make improvements in the business. But there’s an all-too-common disconnect between CEOs absorbed by their big ideas and investors who find it frustrating that they’re expected to bet blindly on the future. The ...

Four reasons that lease accounting distorted reality… have now become five

From The Uniform Accounting Monthly Report April 2021: I recently had a wonderful conversation with Ralph Nach. Ralph is a former co-author of the Wiley GAAP Guide. He teaches continuing professional education courses for practicing CPAs on many of the most difficult and complex accounting topics. Ralph was also one of the very first members of the UAFRS Advisory Council for Uniform Accounting. To cover the new accounting rules for lease capitalization, Ralph has a remarkable four-hour module on just ...

Audit watchdog proposes framework to help implement new trading ban

From WSJ: The U.S. audit watchdog has proposed a new framework that would help it implement a law that bans foreign companies from the country’s exchanges if their audits haven’t been inspected by American regulators. The Public Company Accounting Oversight Board’s framework would help it decide whether it can review or investigate a public audit firm in certain jurisdictions, such as China or Hong Kong. The law banning certain foreign businesses from U.S. exchanges—known as the Holding Foreign Companies Accountable Act—was ...

OECD to introduce cryptocurrency reporting by end 2021 – Tax Advisers Europe

From Tax Advisers Europe: During the CFE’s 2021 Forum, held virtually on 6 May 2021, Director of the Centre for Tax Policy at the OECD, Pascal Saint-Amans, gave a keynote speech on the panel discussion topic of cross-border exchange of information. Mr Saint-Amans confirmed that the OECD aims to update reporting standards for exchange of information to include cryptocurrencies and e-assets by the end 2021, noting that the US is particularly interested in the expansion of the reporting standards to include ...

What CFOs and CEOs are saying about bitcoin

From On first-quarter earnings calls, CFOs and CEOs revealed their attitudes about and approaches to cryptocurrencies. What is your thinking on Bitcoin and cryptocurrencies? Many “experts” claim to know what CFOs and CEOs think about the development of digital assets, the use of Bitcoin on balance sheets, and the business opportunities crypto presents. But rarely do they examine the public statements by members of the C-suite. To gauge the prevailing sentiments about Bitcoin, we combed through the earnings calls ...

More companies buy back shares, pay dividends a year into pandemic

From WSJ: U.S. businesses, many of them no longer facing cash-flow woes, are returning more capital to shareholders. Companies are spending more money on dividends and share repurchases after pausing or shrinking them last spring in an effort to preserve cash during the coronavirus pandemic. Executives are boosting these shareholder rewards as they are growing more optimistic about the economic recovery and the outlook for their business. The U.S. economy is expected to grow by 6.4% this year, with Covid-19 vaccinations and stimulus funds ...

Corporate cash holdings metric offers mixed signals

From About one-third of companies saw their cash balances fall in the first quarter, but did that indicate investment or poor financial performance? Many companies beefed up their cash and short-term investment balances in 2021’s opening quarter, but not all of them. In fact, 34% of organizations cut their cash holdings, compared with the 40% who increased them. The +6 percentage point difference is what the Association for Financial Professionals (AFP) calls its Corporate Cash Indicators index. (The percentage of companies with higher ...

CFOs have a limited window to derive competitive advantage from Artificial Intelligence – Gartner

CFOs must invest in artificial intelligence (AI) within the next few years, or their companies will be left behind, according to Gartner, Inc. In a survey of 300 CFOs and finance leaders in May 2020, 90% of respondents said they anticipate investing “more, less, or the same amount” in AI since COVID-19. To get the full benefits, and thus competitive advantage, from such investments CFOs must look beyond projects that only aim to modernize the function. “There’s nothing wrong with ...

Concern over lack of coherent approach to digital tax across the globe

From CFE Tax Advisers Europe: CFE takes note of the Digital Levy Roadmap and the public consultation published by the European Commission, and is pleased to have the opportunity to comment on the Roadmap. CFE notes that at the time of this statement being issued, in April 2021, international negotiations at OECD level on developing technical and policy solutions to agreeing tax allocations rights, in an attempt to ensure digital companies pay tax wherever they have significant consumer-facing activities and ...

Up from the ashes: Restaurant CFOs prepare for boom

From CFO Dive: Profit-hungry restaurant CFOs blindsided by the pandemic get ready for robust economic growth, offering lessons for leaders in less-stressed industries. Restaurants lost $270 billion last year from coronavirus shutdowns, and many of those that survived the crisis did so in a sink-or-swim frenzy. Now, as the economy begins to surge, surviving restaurants are getting ready to ride a rising tide of customer demand. The economy grew at a 6.4 annual pace during the first quarter and sales ...

CFOs ponder remote work possibilities

From When we talked to CFOs about their plans for a post-pandemic workplace for our October 2020 story, “Is Remote Work Working?” two messages came through loud and clear. First, CFOs told us that telework would permanently expand to more positions than before March 2020, when companies abruptly sent employees home to work remotely. Second, they discovered that even six months into the global pandemic, the “end” seemed so far into the future that it was difficult to assess when ...

Tax Inspectors Without Borders and partners collect $1bn in additional tax revenues for developing countries

From the OECD: Through its innovative approach to audit assistance, Tax Inspectors Without Borders (TIWB) has strengthened significantly developing countries’ ability to effectively tax multinational enterprises. TIWB is a joint OECD/UNDP initiative that deploys qualified experts in developing countries across Africa, Asia, Eastern Europe, Latin America and the Caribbean to help build tax capacity in the areas of audit, criminal tax investigations and the effective use of automatically exchanged information. TIWB assistance has led to increased domestic resource mobilisation in some ...

Labour market disruption & Covid-19 support measures contribute to widespread falls in taxes on wages in 2020

The COVID-19 crisis has resulted in the largest decrease in taxes on wages since the global financial crisis of 2008-09, according to a new OECD report. Taxing Wages 2021 shows that declining household incomes coupled with tax reforms linked to the pandemic are driving widespread declines in effective taxes on wages across the OECD The report highlights record falls across the OECD during 2020 in the tax wedge – the total taxes on labour paid by both employees and employers, ...

US proposes global minimum taxation

From CFE Tax Advisers Europe: New proposals from President Biden’s administration have increased the likelihood on reaching a global solution for taxation of the digital economy, including minimum taxation. Seeking to reassert US leadership in global economic policy, Secretary of Treasury Janet Yellen set out proposals for global minimum corporate tax rate allowing governments to tax the global profits of 100 largest and most profitable multinationals, including the large US tech companies, regardless whether they reach a ‘permanent establishment’ threshold ...

Collections: Customer excuses, payment delays rising dramatically

From CFO Daily News: Customer excuses have been spiking in recent months, especially for small- and mid-sized businesses. And you can thank the coronavirus pandemic for it. A recent survey from the UK uncovered that 59% of businesses say they’re running into more excuses for past-due bills. Specifically, this survey focused on small- and mid-sized businesses and their current cash flow challenges more than a year into COVID-19. And you can bet there’s a similar situation over on this side of the ...

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