Video | Newsletters | Alerts | Member Center | Subscribe Now

The Best of 2006

You are here: Home : Buyer's Guides and Special Reports : The Best of 2006


			IN THIS REPORT

What must you know about the year gone by? Here's our roundup of the best articles of 2006, broken out in seven main topical areas: accounting, capital markets, technology, risks and benefits, careers, deals, and law and order. Read more by clicking on the links below in "Best of 2006 Summaries, by Subject," or simply scroll down to peruse the articles that were the most popular among your colleagues and competitors.


		BEST OF 2006 SUMMARIES, BY SUBJECT

		Best of 2006: Accounting Are you up-to-date on all the accounting developments of 2006? Here is our editors' selection of the most popular accounting articles of the year.

		Best of 2006: Capital Markets Venerable institutions were called into question this year, while new ideas permeated the LBO, M&A, and debt-raising markets. Here is our selection of the capital markets articles that were most popular among your colleagues and competitors in 2006.

		Best of 2006: Technology From XBRL and IT controls to security and the gadgets we hate to love, here are CFO.com's most popular technology articles of 2006.

		Best of 2006: Risks and Benefits Toxic detritus and terrorism continued to haunt finance chiefs this year, while the new pension law provided relief on the employee benefits front.

		Best of 2006: Careers Here's a primer for your next career move, whether that means stepping up to the CEO slot, taking on the finances of a smaller company, or even opening your own restaurant.

		Best of 2006: Deals From the influence of private equity to the continuing importance of strategic transactions, here is our selection of the most popular deals articles of the year.

		Best of 2006: Law and Order Enron's big three were convicted this year, but only two went to prison. The WorldCom, HealthSouth, Tyco, and Adelphia criminal sagas also were wrapped up, for the most part, while a dominatrix paid a visit to an accountant.


		ACCOUNTING

		FIN 47: The Future Is Now Under the new standard, many companies may have to book future cleanup costs, whether or not they can be ascertained today.

		How Much is that Error on the Books? Following new SEC guidance, companies have a new way to 'fess up on errors in their next 10-K.

		Accountants: Going Once, Going Twice Bring your auction paddle and get ready to bid for finance help.

		Securitization: Cash Flow on Tap A popular financing technique, sometimes criticized for its off-balance-sheet treatment, may be skewing cash-flow statements too, says a new report.

		Up on Cripple Creek, a New Kind of Gold An obscure accounting rule, combined with a shortage of urban real estate, is creating a rush to reclaim contaminated land. Now one company that made its fortune in the gold-rush era is cashing in again.

		Execs' Letters Rip FASB Pension Draft The proposed statement by the accounting board could upset companies' annual budgeting and create chaos at year's end, employers contend.

		Simplifying Accounting Is No Simple Task A recent FASB proposal allowing fair value measurement is too complicated, say critics who normally support such measures.

		Gift Cards and Revenue Recognition For retailers, these cards can be a gift that keeps on giving, although sometimes, what they give is accounting headaches.

		SEC Issues Option Accounting Guidance New guidance from the Chief Accountant tells companies how to respond to various outcomes of internal investigations into backdating and other stock option granting problems.

		Pension Dissension FASB gets an earful as CFOs protest key details of pension-accounting reform.

		FASB Calls for a Cultural Change Executives who use accounting-motivated transactions to prop up financial results are among the obstacles to a principles-based approach, says Robert Herz, the board's chairman.

		Binomial Creep Although most companies still use Black-Scholes to value their stock options, a small but growing number are finding good reason to employ a more complicated valuation model.

		Lost in the Maze Problems with hedge accounting caused a wave of restatements in 2005. Are FASB's rules too hard to follow, or are companies simply too lax?

		Software Capitalization Clouds Comparisons Although many companies expense their software development costs, according to a new study, differences in accounting approaches can give ''the impression that those that are capitalizing are doing better financially.''

		Restatements: Stupid Human Tricks? When they restate, companies would do well to disclose how they found the triggering errors, says the SEC's Scott Taub.

		The Battle to Preserve LIFO Prompted by Congressional thoughts of repeal, companies that use last-in, first-out inventory accounting start mobilizing their defense.

		FASB To Change Derivative Accounting FASB aims to eliminate the income statement volatility from asset-backed derivatives.

		FASB Issues Lease Accounting Guidance A new staff position requires companies to account for the "economic reality" of leveraged leases.

		FASB Hoists Red Flags Higher for Taxman A new accounting rule changes the way companies report their uncertain tax positions, and may serve as a roadmap for IRS auditors.


		CAPITAL MARKETS

		Bush Signs Rating Agency Reform Act The new law, according to one lawmaker, addresses an "industry that was beset by conflicts of interest and a lack of competition."

		How Sarbox Can Cure the Rating Agencies The Senate Banking Committee hears a call for a "simple, bright-line rule" to prevent credit raters from using their clout to gain consulting business.

		Are Buybacks Financial Coverups? Some stock buybacks can conceal a company's true economic condition while boosting executive compensation.

		Bondholder Backlash LBO debtholders are getting tougher about protecting their interests.

		Fed: Hedge Funds Get Too Much Credit In a sign of growing concern, the president of the New York Federal Reserve calls on banks to tighten up their lending to hedge funds.

		This Way to the Mezzanine New instruments called ''reversible warrants'' enable fast-growing issuers to take back equity rights forfeited in financing, provided that the issuer hits certain performance milestones.

		What’s a Backdated Stock Option Worth? Backdated stock options aren't as valuable as you might think.

		If You Love a Company, Set It Free? The SEC may loosen deregistration requirements for foreign companies as a way to attract more overseas issuers. But the move could backfire.

		A Hard Shell Managers of special purpose acquisition companies, or SPACs, are on the hunt for merger targets.

		Private Equity Firms Chasing Small-Caps Of $76 billion in high-yield debt issued so far this year, $22 billion financed mergers and acquisitions, a trend that is likely to continue as small company IPOs take a back seat to private equity purchases.


		TECHNOLOGY & FINANCIAL SOFTWARE

		E-Proxies to Debut in 2007 Ready or not, electronic filings will soon be a choice for companies and investors. What's more, the SEC is proposing a mandatory requirement that companies push more regulatory solicitations to the Web.

		Angry and Bored? You Must Be a Customer Finding out what customers really think is a crucial first step toward an improved bottom line. New technology may help.

		Future Office The very near future, that is, for six areas where technology is transforming business in dramatic fashion. CFO Asia examines what finance executives can do to manage the change.

		Spreadsheet by Google? First there was Visicalc, then Lotus 1-2-3, then Excel, now . . . Google?

		Due Diligence, Quick and Clean Using "virtual rooms," merger targets can meet a bevy of far-flung suitors with little muss and fuss.

		Park Anywhere Thirteen gizmos that will keep harried executives cool, calm, and connected.

		The Cost of Mobile Working ''Out of the office'' contributions by employees are increasingly important to many companies' competitive strategies. The question for the finance department: How much are we really spending to make it possible?

		CFOs and Gadgets: A Love/Hate Relationship Execs say they spend too much time with their mobile gadgets. Then again, execs say they love their gadgets.

		10-Ks, 8-Ks a Thing of the Past? In announcing that the SEC's XBRL project will be done within a year, Chairman Christopher Cox said investors will be able to assemble their own financial data, rather than rely on current regulatory documents.

		A Vision Problem at Top Audit Firms Do the CEOs of the top audit firms really want to use technologies such as XBRL to revolutionize financial reporting, or do they simply want to insulate their firms from liability?

		XBR-What? Even as SEC chairman Cox champions "interactive data," few CFOs seem impressed. Is that because too few of the benefits accrue to them?

		Ready or Not, XBRL Is Coming The SEC and FASB are gearing up for XBRL, suggesting it's only a matter of time before its use becomes mandatory.

		Will the AICPA Take Over XBRL Standards? Companies could be filing XBRL-ready financial statements as soon as 2008. But some observers worry that the definitions corporations will have to follow will be written almost entirely by accountants.

		Survey: IT Falls Behind on Compliance But, fifty-eight percent of the survey respondents said their IT spending will increase.

		Solving the Audit Gap When it comes to keeping IT-related control deficiencies to a minimum, it's more important to improve communication than it is to improve your technology.

		SAS 70 Weak on Data Security: Experts "If you’re depending on SAS 70 for assurances around information security, you’re depending on the wrong thing," says one vendor.

		How to Put Your Spreadsheet in Lockdown Will security problems render the format obsolete?

		Is Your Blackberry a Hacker's Back Door? Blackberries, derided as "crackberries" for their addictive qualities, may also be a crack in your company's IT armor. A program to be released this week highlights the potential risks.

		Help! I'm Your Laptop and I've Been Stolen How to recover your stolen laptop, or at least destroy its secrets, using the latest crime-stopping gizmos.

		Are Your Business Partners an IT Threat? A third of organizations responding to a recent survey said business partners had caused a security incident in the past year.


		RISKS & BENEFITS: EMPLOYEE BENEFITS

		Can 401(k)s Replace Pensions? Many employees can earn as much retirement income with a 401(k) as they can with a traditional defined-benefit plan, a pro-employer advocate asserts.

		Pension Act Tilts to Cash-Balance Plans But employers still might want to shun old-style defined-benefit plans for the comfort of a 401(k).

		HSAs May Not Deliver Company Savings A new study on health savings accounts says these 401(k)-like vehicles may not provide the medical spending relief some executives expect.

		Sprucing Up the 401(k) With other retirement vehicles in dire shape, plan sponsors are rethinking their defined-contribution offerings.

		FASB Rule Puts Pensions on Balance Sheet The board will start requiring publicly traded companies to state the underfunded or overfunded status of their pension and benefit plans on their financials at the end of fiscal years ending after December 15.


		RISKS & BENEFITS: RISK MANAGEMENT

		Coming Distractions If these eight risks are not on your radar screen, they will be soon.

		How Regulation Drives up Insurance Costs Why should companies care who regulates their insurers? Because, say corporate risk managers, state-by-state regulation causes paperwork to soar, complicates taxes, increases legal risk, and costs more.

		How to Bungle Political Risks A survey finds that most senior executives consider overseas perils a low priority, even when they have investments and operations abroad.

		Defending Against Backdating Suits Lawsuits related to options backdating are on the rise, and directors and officers should consider both defense and insurance strategies as investigations turn into restatements.

		Who's Controlling the Controller? While debate goes on over internal control requirements for public companies of all sizes, private companies face control risks that range from overly-complex spreadsheets to the controller who decides to shun the IRS.

		Risk Management: More Talk Than Action Enterprise risk management is typically the CFO's job, according to a new survey that says companies are still struggling to put effective systems in place.


		RISKS & BENEFITS: INSURANCE

		Serenity Now! Board members worried about compliance-related lawsuits may want to revisit their D&O policies.

		Property Insurance's Uneven Price Blip Except for companies in storm-prone areas like Miami, the increase in premiums will likely be short-term.

		Insurers Seek Freedom from States Insurance executives tell Congress that having a single federal regulator, or at least the option of one, could result in lower premiums than they can offer under the current 50-state system.

		A Tale of Two Insurance Markets Overall, commercial premiums dipped for companies that don't really need hurricane or earthquake insurance.


		CAREERS

		Making the Short List for CEO More finance chiefs are finding their way into the CEO slot, as Burger King's John Chidsey recently did.

		Hire Callings Leaving a finance career doesn't necessarily mean leaving finance.

		Fresh Start A break from CFO duties can be rejuvenating, but don't stay away too long.

		A Perfect Fit The demand for finance talent may be soaring, but candidates refuse to settle for just any job.

		Bigger Fish, Smaller Pond Leaving a large company for the CFO spot at a smaller company can be a great move — as long as you do your homework.

		Private Club Opportunity is knocking for CFOs who have the skills that private-equity firms demand.

		Hire Power Even if you're not looking for a job, a job may be looking for you.

		Heavy Vetting Boards of directors now want to talk to would-be CFOs — and vice versa.

		Career Swings Finance career paths increasingly include a stopover in IT.

		Are You Overworked? Surprise. A new study says the CFO's job is harder than ever. But the news isn't all bad.

		UnitedHealth CFO Resigns Amid Overhaul Incoming CEO will also see his options repriced downward and will have to let go of the value of certain options, with the two actions amounting to a drop in the value of past equity compensation worth $190 million.

		Comverse CFO, Two Others Resign The company's board questions the timing of stock option grants amid wider regulatory scrutiny of the issue by the SEC.

		Will CFO Decker Take the Reins at Yahoo? Yahoo taps CFO Susan Decker to head the most prominent of the company's three business units, sparking speculation that she is the favorite choice for the corner office.

		HP CFO Wayman to Retire CFO Robert Wayman, a 37-year veteran of HP, will step down at the end of the year. His final year with HP was tarred by a boardroom leak investigation that led to the resignation of then-chairman Patricia Dunn.

		Bank of America CFO Resigns Sarbox took the "fun" out of being a CFO, said de Molina, who may head back to his risk-taker roots.

		Sears Taps Monaghan as CFO Edward Lampert turns to former tank commander and AutoNation CFO Craig Monaghan to lead the ongoing integration of Sears and KMart.

		The Post Office Gets a New CFO The U.S. Postal Service looks to private industry for its new CFO, and selects Harold Glen Walker, known for his work building Whirlpool's innovative shared-services center in Dublin.


		DEALS

		What Lies Beneath Private-equity firms know how to make companies look good. But this buyer knows how to look more closely.

		Can You Keep a Secret? M&A can become a cat-and-mouse game as companies attempt to analyze (or safeguard) sensitive data.

		Rising Stakes How the strength of private equity is changing M&A for corporate buyers.

		Mergers for Small Companies On the Rise Industrial sector breaks out of 19-year lull.

		Try Before You Buy Companies are using alliances to take the risk out of acquisitions.

		The End of the Merger Curse? More M&A deals are financially successful, according to new research. Is it a trend or coincidence?

		All's Fair in M&A? Judges and regulators are taking aim at conflicted "fairness" opinions.

		Cash Stockpiles Will Fuel Mergers: PwC With banks more willing to lend money—and with corporate piggy banks filled to record levels—companies will speed up acquisitions in the next year to pursue growth, according to a forecast by the Big Four firm.

		Merge Right Numbers don't drive deals. People do.

		America for Sale Foreign firms are buying U.S. companies at the fastest clip in five years, creating concerns on Capitol Hill.


		LAW & ORDER

		Where Are They Now? This week, Enron's Andy Fastow was sentenced and WorldCom's Bernie Ebbers reported to jail. Here's our up-to-date tally of what happened to executives at five of the most infamous financial frauds in Corporate America.

		Penalty Box The SEC is handing out bigger and bigger fines for misdeeds. But is this the right approach?