Separate but Liable

The ability to legally separate risks and liabilities within a corporation is a cornerstone of Corporate America. Subsidiaries, limited-liability corporations (LLCs), franchisor/franchisee arrangements, joint ventures, securitizations, trusts, and other special-purpose entities (SPEs, or variable...

By Kris Frieswick • March 1, 2003

Key-Person Insurance a Hard Sell

Andrew Morrison, CFO of American Science and Engineering Inc., passed away in August at the age of 52, a year after joining the $70 million manufacturer of X-ray detection and imaging systems. At the time of Morrison’s hiring, AS&E chief executive officer Ralph Sheridan said the CFO brought “...

By Russ Banham • March 1, 2003

CFOs: We Plan to Hire More in Q2

Here’s a bit of good news for job-hunters seeking work in finance.The hiring of accounting and finance professionals is expected to increase very slightly in the second quarter, according to a Robert Half International quarterly survey of chief financial officers.Nine percent of CFOs said they pl...

By Stephen Taub • Feb. 14, 2003

Are These What You Call Worst Practices?

According to a major research report from consultancy The Hackett Group, most companies still have sizable weaknesses in their financial operations. This even though publicly traded companies now face increased scrutiny from government regulators.The Hackett Group survey found that most corporate...

By Stephen Taub • Feb. 13, 2003

Sarbanes-Oxley Spurs ERM

Finance chiefs at life insurance companies are responding to provisions of the Sarbanes-Oxley Act by boosting their enterprise risk management (ERM) practices, according to a new survey by Tillinghast-Towers Perrrin, the risk management consulting firm.Fifty-three percent of 30 life insurance CFO...

By David Katz • Feb. 5, 2003

Enron Creditors Sue Lay; Enron Sues Customers

Former Enron chairman and chief executive Kenneth Lay and his wife, Linda, have been sued by creditors seeking to recover more than $70 million, according to the Associated Press, citing court papers.The committee representing unsecured creditors in Enron’s Chapter 11 case filed the suit last Fri...

By Stephen Taub • Feb. 4, 2003

Cozying Up to Analysts

In an attempt to provide a more open line of communication with investors and analysts, many companies are ditching the canned presentation in favor of an informal meeting heavy on question-and-answer periods. Impromptu dialogues — sometimes called “fireside chats” — are more effective at making ...

By David Campbell • Feb. 1, 2003

White-Collar Crime? Now It’s Button-Down-Collar Crime

CFOs and senior finance executives have always wanted to be seen as crucial members of corporate management. And when it comes to fraud, it appears that some of them are.Or at least that seems to be the takeaway from an exhaustive five-year study by the Securities and Exchange Commission of enfor...

By Stephen Taub • Jan. 29, 2003

Trend: CFO to CEO

Another former finance exec has snared the top spot at a major corporation.Kmart Corp., slated to emerge from bankruptcy around April 30, surprisingly tapped president Julian Day as its new CEO. Day succeeds James Adamson, who will continue to serve as chairman through the final stages of the com...

By Stephen Taub • Jan. 21, 2003

Morgan, Insurers Settle on Enron Surety Bonds

JP Morgan Chase & Co. finally settled its dispute with a group of 11 insurance companies that had issued surety bonds for obligations guaranteeing finance deals the bank set up for Enron Corp.Under the agreement, JP Morgan Chase will receive about 60 percent of the principal amount of $965 mi...

By Stephen Taub • Jan. 3, 2003

Tag Time?

Motorists use them to cruise through highway tollbooths, marathon runners rely on them to accurately monitor race times, and they can even help reunite a lost pet with its owner. Now radio frequency identification (RFID) tags may revolutionize supply-chain operations by offering a superior way to...

By Monica Deady • Jan. 1, 2003

Lost in Space

Inktomi’s eyes were bigger than its stomach. Like other presumptuous technology companies in the Bay Area, Inktomi Corp. binged on real estate in the late 1990s, signing a 15-year lease on a nearly 400,000-square-foot office complex, a $300 million commitment for a partially built edifice that it...

By Russ Banham • Jan. 1, 2003

Report: Feds Probing Former Enron Treasurer

First, Michael Kopper. Then Andrew Fastow. Now, it appears another former Enron Corp. finance executive may be facing a criminal indictment.Ben F. Glisan Jr., the scandal-plagued energy trader’s former treasurer, was told by federal prosecutors he is under investigation for his role in Enron’s co...

By Stephen Taub • Dec. 30, 2002

Ex-Enron Execs, Banks Can Be Sued, Says Judge

The lawyers are flying lazy circles over Houston.On Friday a federal judge ruled that former Enron Corp. executives and lenders must face investor lawsuits seeking $29 billion in damages related to the energy company’s collapse. U.S. District Judge Melinda Harmon denied a motion to dismiss the cl...

By Stephen Taub • Dec. 23, 2002

All in the Family

The wife of former Enron Corp. CFO Andrew Fastow may be charged in connection with her husband’s indictment, according to the Houston Chronicle.A grand jury investigating Enron has also heard testimony in an attempt to determine Lea Fastow’s knowledge and control of the money Andrew Fastow illega...

By Stephen Taub • Dec. 20, 2002

Hopkins to Join Citigroup

She’s back.Deborah Hopkins, who in 2000 was named the second most powerful woman in American business by Fortunemagazine, has returned to the corporate world, joining Citigroup as head of corporate strategy and a member of the company’s management committee.As you know, Hopkins is noted for shaki...

By Stephen Taub • Dec. 18, 2002

O’Neill Shown the Door

Call it the opening salvo in the 2004 Presidential campaign.With U.S. stock markets still floundering — and with a national election only 2 years away — the Bush administration launched a major shakeup of its economic team today, announcing the resignations of Treasury Secretary Paul O’Neill and ...

By John Goff • Dec. 6, 2002

Fire at Former House of Fastow

The Enron saga took a bizarre twist just a day short of the one-year anniversary of the energy company’s historic bankruptcy filing.An unfinished home once owned by former Enron CFO Andrew Fastow was deliberately set on fire early Sunday morning. The home, located in a wealthy suburb of Houston, ...

By Stephen Taub • Dec. 3, 2002

Stock Option Hedging

Given the trouble EDS Corp. has incurred from its equity-based hedging program, it’s little wonder such techniques are under fire. In late September, the Plano, Tex.-based company announced that it had to issue $225 million in commercial paper to buy back 3.7 million of its own shares, thanks to ...

By Alix Stuart • Dec. 1, 2002

Stock Splits

For years, reverse stock splits have been seen as window dressing, or a desperate attempt by tiny companies to avoid being delisted. But what about the reverse splits now being completed or considered by such companies as AT&T Corp., Lucent Technologies Inc., and Palm Inc.?Despite analysts’ d...

By Tim Reason • Dec. 1, 2002

SEC Turmoil

Harvey Pitt may be gone, but what he left undone can’t be forgottenThe perpetually embattled chairman of the Securities and Exchange Commission resigned on Election Night after 15 tumultuous months in office. Criticized for being too close to his former Wall Street clients, unable to build consen...

By Lori Calabro • Dec. 1, 2002

Cover Me

As restatements go these days, it seemed a pittance. What’s more, the change reported by Westaff, a temporary-staffing company, looked like a positive one. Partly because of tax-law changes in the federal economic stimulus bill enacted in March, the Walnut Creek, California-based company should h...

By David Katz • Dec. 1, 2002

WorldCom Halfway Home

WorldCom took a major step toward emerging from bankruptcy when a federal judge on Tuesday approved a partial settlement in what the Securities and Exchange Commission has deemed the largest corporate fraud in the commission’s 70-year history.The SEC’s case is still open, however, and WorldCom st...

By Stephen Taub • Nov. 27, 2002

I Did Nothing Wrong, Says Fastow

Former Enron Corp. chief financial officer Andrew Fastow pleaded not guilty to a 78-count indictment that he defrauded the energy trader and its shareholders.Fastow, appearing yesterday before U.S. Magistrate Marcia Crone, stated that he was innocent of charges ranging from fraud to money launder...

By Stephen Taub • Nov. 7, 2002

Double-Header: Fastow Charged with Fraud, Pitt Urged to Resign

Federal prosecutors probing Enron Corp.’s collapse finally reeled in a big fish.After weeks of media speculation, former Enron chief financial officer Andrew Fastow was indicted Thursday on 78 counts. The long list of charges includes fraud, money laundering, and conspiracy as part of an alleged ...

By Stephen Taub • Nov. 1, 2002