Picking Apart the Pieces

Make room, earnings management. Despite recent reports that the Securities and Exchange Commission is intensifying its crackdown on accounting fraud, agency officials are warning that their investigative spotlight may now also be trained on disclosure issues.In March, Robert Bayless, chief accoun...

By Tim Reason • Aug. 1, 2001

Capping Liability

Corporations struck out in two recent U.S. Supreme Court decisions involving wage awards, and both cases underscored financial liability issues. In United States v. Cleveland Indians Baseball Co., the team doled out back pay in 1994 as the result of a free-agency settlement. It paid taxes at the ...

By Joan Urdang • Aug. 1, 2001

Moody’s Says Corporate Default Risk Dropped ‘Markedly’

Companies are less likely to default on their debt than they were a month ago, according to Moody’s Risk Management Services. But, don’t get too smug. The default risk still remains at 20-year highs due to huge indebtedness, sluggish earnings prospects, and volatile equity markets, says Moody’s.T...

By Stephen Taub • July 26, 2001

A Company’s Mind is a Terrible Thing to Waste

Too often, companies let their bright ideas soak up costs, moldering in the drawers of legal departments.Old patents go unused, incurring millions in maintenance fees. A company spends time and money researching a new technology, only to find that a small competitor has already patented it. Negle...

By David Katz • July 26, 2001

HR Case Study: Should You Tell Them They’ll Be Laid Off?

You’re a chief executive officer who knows that the acquisition your company’s about to make will probably result in layoffs.Your big problem is that you’ll need those workers for almost two years before you plan to let them go.Do you level with them about the situation?D. Keith Grossman, CEO and...

By David Katz • July 23, 2001

SAFECO to Cut 1,200 Jobs

SAFECO, the Seattle-based property-casualty insurer, said today it will cut employment by 10 percent, or 1,200 jobs, by the end of 2003, with half of the cuts occurring this year.In a press release, the company said the layoffs combined with previously announced plans to consolidate the company’s...

By CFO Editorial Staff • July 18, 2001

How to Prepare for Irate Shareholders

When the economy is strong and corporate profits robust, shareholders are generally supportive and relatively conciliatory. Shareholder meetings are also sparsely attended. When the going starts to get tough, however, they become a lot more confrontational, and shareholder meetings tend to become...

By Jennifer Caplan • July 18, 2001

Solly Agrees to Settle Discrimination Lawsuit

Salomon Smith Barney agreed to shell out $635,000 to settle a discrimination lawsuit filed by the Equal Employment Opportunity Commission, according to Dow Jones News Service. Salomon settled the lawsuit “without admitting any unlawful conduct,” according to the wire service, citing a statement t...

By Stephen Taub • July 17, 2001

What’s Your Risk Metric?

Think of putting these risks into a single package: The possibilities that your company’s brand name will be tarnished; that an earthquake will level its plants; and that interest-rate swings will hurt its bond investments.Think, in fact, of measuring all your company’s perils with a common denom...

By David Katz • July 12, 2001

CSFB Fires Investment Banking CEO Amid IPO Probes

Credit Suisse Group fired Allen Wheat, the chief executive of the firm’s investment banking group, Thursday amid a government probe into how the firm allocated IPOs during the tech-stock boom, according to an Associated Press report.Wheat, who ran CSFB since 1997, was replaced by former Morgan St...

By CFO Editorial Staff • July 12, 2001

Global Warming Hasn’t Boosted Storm-Related Damages, Study Argues

Contrary to some analysts’ claims, global warming hasn’t caused increases in catastrophic hurricane damages, contends a new study of insured hurricane damages from hurricanes affecting the continental United States in the 20th century.Key findings of the study Tillinghast-Towers Perrin, according...

By CFO Editorial Staff • July 11, 2001

Web Site Settles Shareholder Lawsuit for at Least $4.25 Million

Drkoop.com Inc. announced on Monday that it reached a tentative agreement to settle the consolidated securities class action litigation and shareholder’s lawsuit filed against certain former officers and directors for $4.25 million in cash and $10 million in warrants. The $4.25 million will be fu...

By CFO Editorial Staff • July 9, 2001

CFO Career Tip: Go to HR School

Here’s a tip for CFOs on how to boost your job prospects: Serve an apprenticeship in the human resources department. It could help make your company’s next merger a career-building success. With the fate of M&A deals often hanging on intangibles like the quality of a workforce or a customer b...

By David Katz • July 5, 2001

How to Develop a Positioning Statement

Almost every press release or other corporate communication has one: A “boiler-plate,” canned statement describing what a company does, differentiating the firm in terms of its markets or competitors, and establishing the company’s prospects going forward.And while the casual reader may tend to s...

By Ed Zwirn • July 2, 2001

How to Develop a Positioning Statement

Almost every press release or other corporate communication has one: A “boiler-plate,” canned statement describing what a company does, differentiating the firm in terms of its markets or competitors, and establishing the company’s prospects going forward.And while the casual reader may tend to s...

By Ed Zwirn • July 2, 2001

Sexual Harrasment

Legal departments would have a much easier time if the Love Bug virus were confined to computers. But with longer hours and fewer formalities at the office, love has been blooming among employees. According to a survey by Vault.com, a career Web site, nearly 50 percent of respondents have been ro...

By Alix Stuart • July 1, 2001

Privacy Matters

Amazon.com’s recent brush with the Federal Trade Commission over consumer privacy (the agency claimed the company’s practices were “deceptive” but did not take action, although Amazon did spend $1.9 million in legal fees as a result) is further proof that senior executives should take a hard look...

By Alix Stuart • July 1, 2001

Internet Law

Amazon.com’s recent brush with the Federal Trade Commission over consumer privacy (the agency claimed the company’s practices were “deceptive” but did not take action, although Amazon did spend $1.9 mil-lion in legal fees as a result) is further proof that senior executives should take a hard loo...

By Alix Stuart • July 1, 2001

At-Will Employment

As companies mull possible midyear layoffs in response to a slowing economy, executives should take another look at an October California Supreme Court decision that handed companies an at-will employment victory.An at-will policy allows employers to terminate workers at the company’s discretion....

By John P. Mello Jr. • July 1, 2001

Disclosure Rule

The Securities and Exchange Commission wants companies to present their stock option compensation plans in neat, easy-to-read tables, rather than relegate the information to a footnote. To that end, the commission released a proposed rule calling for the tabular disclosures to be included in prox...

By John P. Mello Jr. • July 1, 2001

SEC Scrutiny

You may be hearing from us,” warns chief accountant Robert A. Bayless, of the Securities and Exchange Commission’s division of corporation finance. Apparently, before the slowdown in initial public offerings this year, companies had a 1 in 15 chance of being reviewed. But with extra time on its h...

By Jake Wengroff • July 1, 2001

Let There Be Light

Tim Condon isn’t overly worried about the soaring electricity costs at his own office. After all, electricity is still a small portion of the operating costs for Household Automotive Finance, in San Diego. But the CFO is worried about the electric bills of Household’s customers– all subprime borr...

By Tim Reason • July 1, 2001

Why Employers Should Sound the Alarm on Expiring Options

How interested are employers in alerting employees that their in-the- money stock options will soon expire?Listen to Tim Clancey and you might get the idea that employers simply aren’t that concerned.In May 2000, Clancey, now a vice president at a bank in Northern California, left a similar post ...

By David Katz • June 28, 2001

E-commerce Insurance: New Riders of the Digital Age

Theorem: Technology is not always the answer.Proof #4,825: In 1930, the French military began constructing a great barricade across the entire French-German border to prevent a repeat of the German invasion two decades earlier. The brainchild of French defense minister André Maginot, the interloc...

By Tim Reason • June 15, 2001

“Brazilianriver.com”

The panel members were winking while trying to be “discreet.”And you may have needed an atlas to help you get the reference.But a rudimentary knowledge of geography and a passing familiarity with some of the events that have precipitated the dot.com implosion of recent times left the reference an...

By Ed Zwirn • June 14, 2001