Michaela McGinn, director of Deloitte & Touche's assurance and advisory group in Columbus, says the first thing to do is examine your debt arrangements.
"It's not rocket science, but many businesses aren't considering this issue," says McGinn.
She recommends refinancing debt to a lower rate or converting variable rate loans to a fixed rate.
"Right now you might be tempted to leave the debt in a variable rate term since the interest rate is so low," says McGinn. "But the interest rate will go up, so long term, you are better off changing to a fixed rate."
Another technique to improve cash management takes some planning.
"Plan out your cash flow and see the spikes in cash demand, and plan to have the cash ready for them," says John Vogelpohl, a partner with Rea & Associates.
Vogelpohl says some companies work to increase sales but don't plan for the resulting increased cash demand driven by inventory and salaries when that big contract is landed.
He cites the example of a construction firm.
"A company can incur $80,000 to $100,000 in costs of workers' salaries alone before a penny is paid by the client," he says. "You have to look at that when bringing in new business."
Vogelpohl says you can often negotiate earlier payments with the client when you discover a potential cash problem.
McGinn and Vogelpohl also urge companies to make sure accounts receivables are being managed.
"When you've already sold a product or service, in essence you are providing an interest-free loan to the customer until that customer pays," says McGinn. How to reach: Deloitte & Touche, (614) 229-4787, Rea & Associates, (614) 889-8725
"The goal is to eliminate paper altogether," he says, "and increase efficiencies."
More and more consumers and businesses are banking online, which offers benefits such as real-time payment posting for improved cash flow and the ability to manage multiple accounts. Check imaging is another technology that is quickly becoming a standard.
"Businesses want to manage their funds through the Internet," says Kratzer. "Check imaging allows customers to view checks online."
This improves a bank's productivity, because prior to online imaging, an employee investigating a check had to physically move to another room to find it. Kratzer says as this trend continues, more banking documents and transactions will be accessible online, including transactions that occur with other financial companies like brokers and insurance companies.
"Technology is being designed that will aggregate all of a business's or customer's accounts, and they will be accessible online, on a single screen," says Kratzer. "The Internet is being used more and more as this kind of tool."
Customers will be able to get their statements online, and those statements will continually update.
"They'll be able to see the latest and greatest information as it hits their accounts," Kratzer says.
The growth of Point of Sale (POS) sales terminals that electronically transmit sales transactions and communicate directly with the customer's bank will continue to fuel this trend.
"Banks will be able to put more information into the customers' hands," Kratzer says.
And thanks to improved security, technology customer information and transactions will be protected.
"The important thing is all of this information will be secure," says Kratzer. How to reach: RDSI Banking Systems, (419) 783-8800.
But it doesn't have to be that way. All it takes is a little extra planning, say registered dieticians.
"If you pack your food the night before, you can make sure you are eating healthier," says Stacey Newpoff, clinical dietician for the McConnell Heart Health Center on the Riverside Hospital campus. "And it doesn't take a lot of effort."
Newpoff says even peanut butter on whole wheat bread is a healthier choice than typical fast food take-out.
"I also recommend yogurt and pretzels for snacks," she says. "And pack a frozen entrée."
There are a number of choices for low-fat, low calorie frozen entrées; the biggest drawback can be their sodium content.
If fast food is your only alternative, opt for more sensible choices like salads with low-fat dressing and plain baked potatoes.
"Many fast food places are trying to offer healthier choices," says Newpoff. "like Subway's veggie sub with baked potato chips."
Sue Ayersman, clinical nutritionist with Scottsdale, Ariz.-based Kronos Optimal Health Centre, suggests stocking up on healthy foods and eating them often throughout the day.
"Not eating is a big mistake," says Ayersman. "It leads to bingeing later."
Ayersman says high-starch foods like bagels are not the answer, either.
"You should have a higher protein food like boiled eggs," she says. "Mixed with low-fat cottage cheese, it's a good lunch as well."
Ayersman also recommends hummus because it is high in protein and fiber. And don't rush out for a protein bar -- they are often high in sugar and calories.
"A small package of nuts, mozzarella cheese sticks and fruits like red grapes or peaches are healthy and easy to eat on the go," she says.
And Ayers recommends the overnight traveler pack canned tuna and order a salad at the closest restaurant.
"Eating healthy can be easier and quicker than you think," she says. How to reach: McConnell Heart Health Center, (614) 566-3801; Kronos Optimal Health Centre, (800) 515-5332 or www.kronoscentre.com
That's why many companies invest in directors and officers (D&O) insurance. Just as medical malpractice insurance covers doctors, directors and officers insurance protects your company should a board member or officer make a costly mistake.
"More businesses have exposure to possible lawsuits than actually have this insurance," says Bob Fenner, CEO of Thomas Fenner Woods Agency Inc.
Fenner says even your employees can sue your company if they participate in a profit-sharing plan and feel they have lost money due to director or officer omission or error.
"Anyone that feels he or she has suffered a financial loss as a result of an error can file suit," says Fenner.
And due to events at Enron and WorldCom, there is a growing mistrust of larger companies.
"People feel that these companies misled investors," says Fenner.
So the need for D&O insurance has never been greater, but Fenner says thanks then recent accounting scandals, policies will not be as easy to come by and will be more costly.
"No doubt the policies will be more expensive and companies will be under more scrutiny by underwriters," said Fenner.
Insurance companies will be asking for more extensive financial statements that cover a longer period of time than they did previously.
"A company will need CPA-audited financial statements going back at least five years," says Fenner. "And there will be more scrutiny of the experience of the directors."
Underwriters will look for a conflict of interest and accounting signs of insider trading, as well as at the directors' experience, says Fenner. In the application process, they'll also look for downsizing plans and seek explanations.
Smaller firms that previously purchased D&O insurance because it also protected them against potential employee discrimination suits might now be better served by purchasing an Employment Practices Liability Insurance policy, says Fenner. However, if your company is publicly traded and has 10 or more shareholders, D&O insurance is highly recommended. How to reach: Thomas Fenner Woods Agency Inc., (614) 764-8999 or www.tfwinsurance.com
Here, working adults can find courses both online and in traditional classroom settings.
With most of these programs, the emphasis is on applying the classroom experience to the workplace the next day, which means your company benefits from Day One. Whether you're grooming a successor or sharpening your management skills, there are many academic institutions working to meet your needs.
Most managers and executives feel an MBA is a must, and several programs can provide not only a quality education but hands-on project experience and specialization.
The Fisher College of Business (FCB) of The Ohio State University offers a unique executive MBA program which students can complete in 17 months.
"The program is formatted for the employee that is moving up the ladder," says Carol Newcomb, director of executive education at FCB. "Two-thirds of the class material is offered in the classroom, the remainder is offered over the Web."
The programs encourages students to apply classroom knowledge to their jobs.
"I've heard a student say after the first session that he can use what he learned now," Newcomb says.
Students attending this program are chosen by their companies because they are bright, aggressive professionals climbing the corporate ladder. Many are doctors or lawyers who are leading their firms.
Neil Shnider, director of Capital University's MBA program, says Capital offers two types of MBA programs, each directed to a particular type of student. There's a two-nights-a-week program for those working full time and a day program for full-time students.
"We offer every required course every semester," says Shnider.
And Capital offers the only 12-month daytime MBA program in the city.
"It's a very structured program," he says.
Keller Graduate School of Management of DeVry University offers both the MBA and technology oriented management degree programs.
"Our MBA program and the Master of Information System Management program are the most popular," says Terri Lechton, Keller's center director. "We offer evening, weekend and online formats, and the ability to mix and match them for maximum flexibility."
Lechton says the school's student base includes employees from the area's largest firms as well as budding entrepreneurs.
"In all of our classes, students undertake projects or consult with organizations in the community to apply and sharpen their skills," Lechton says. "They help organizations that do not have the resources to hire external consultants."
Keller offers six specialized master's degree programs that include a Master of Human Resource Management, a Master of Telecommunications Management and, a Master of Project Management. Again, technology is a strong focus of these programs.
"Many of our students are already mid-level managers building skills to move up in their organizations," says Lechton.
Capital University also offers specialized master's and MBA programs. Students can earn a combination of degrees, such as an MBA/JD, MBA/MT (master's of taxation) and MBA/MSN (master's of nursing).
Newcomb, of the Fisher College of Business, says the school has found there's a need for leadership training. In response, it has created its Emerging Leaders Program, in which students meet once a month and work on specific projects.
"The student can apply what he or she is learning immediately," says Newcomb.
Students also receive individual mentoring and counseling.
According to Newcomb, this program is ideal for professionals who have been focused on one area of a business, such as engineering, who are becoming executives. The program shows students how all departments of a corporation work together.
Companies looking to improve processes and efficiencies can also take part in FCB's Six Sigma program. The program, developed by Motorola, is a disciplined, data-driven approach for eliminating waste by improving the quality of organizational processes and products. In other words, it's a way to systematically improve bottom-line results by eliminating defects throughout the value stream.
FCB's program combines one week of classroom experience with 120 hours of online learning to ready the student for the Six Sigma Black Belt, or certification exam.
For small to mid-sized businesses wanting to develop a new or revised business plan, the resource may be the Ohio Foundation of Entrepreneurial Education (OFEE).
"We offer custom business plan programming," says OFEE executive director Sandy Dickinson. "It is very much applicable to new businesses, those looking to revamp their plan or companies looking to move into a new phase."
The program also helps corporate departments develop business plans and assists with new product development.
"The same analysis can be done to address a whole new product line," Dickinson says.
OFEE also offers the program to consulting firms. "Banks, law firms or accounting firms can offer the program to their clients," she says.
Companies can take advantage of programs to provide employees with new skills. Jan Wagner, dean of community education and work force development at Columbus State Community College, says her department's goal is to upgrade the skill level of the area's work force and transition welfare recipients to work.
"We contract with employers to provide the specific job training they need," Wagner says. "Essentially, when the employer calls, we go to the work site and do an assessment."
Columbus State can customize almost any training program to fit a company's needs, "although education is not always the answer to the problem," Wagner says.
Columbus State develops the curriculum and partners with experts on and off campus to ensure the program's quality.
"We had a group of forensic pathologists that wanted a program for digging up bones and determining their age and other information," says Wagner. "We contacted a professional organization expert in this area to help develop the program.
"If we don't have a person on staff, we have a link to the correct professional. How to reach: The Ohio State University Fisher College of Business, (614) 292-8511; Capital University, (614) 236-6670; Keller School of Management of DeVry University, (614) 251-6969; Ohio Foundation of Entrepreneurial Education, (614) 264-9047; Columbus State Community College, (614) 287-2400.
"You definitely want to optimize the value of your investment in other countries," says Joe Bernot, international tax partner with Deloitte & Touche. "Taxes paid in foreign countries may reduce your U.S. tax liability, depending on the situation. If foreign taxes you pay are not creditable, you may be subject to double taxation, which erodes the return on your investment."
And pay attention to potential benefits obtained through tax treaties the United States has made with other nations.
"There are 40 to 50 treaties that can help minimize the tax burden," says Bernot.
Bernot cites the example of an individual or company that makes a loan to a company in the United Kingdom.
"The general rule there is that the interest on the loan is subject to U.K. withholding tax," says Bernot. "The treaty between the U.S. and the United Kingdom reduces that tax to zero."
Companies must also pay attention to where the profit from their activities is earned,.
"Let's say you set up a wholly owned subsidiary in Canada," he says. "The product is manufactured in the U.S. and sent to Canada for distribution. The price you charge the Canadian subsidiary determines how the profit is split between the U.S. and Canada, and determines which country gets the tax revenue."
According to Bernot, where the profit is taxed is important because Canadian taxes are generally higher than U.S. taxes.
Confused? Global tax considerations can be intricate and confusing, which is why Bernot recommends companies consult with an international tax professional prior to setting up business outside the United States.
"If a company ends up with a bad tax structure, it can be costly to unwind and clear up," he says. "If the company does its homework up front, it should be in a good position going forward." How to reach: Deloitte &
Touche, (614) 221-1000
Paul Astleford, the subject of this month's Who to Know, says visitors to Columbus often recognize its strengths more than the natives do, and I tend to agree.
With the Ohio State Buckeyes, the Columbus Crew and the Blue Jackets, amateur sports R-Us. And when it comes to restaurants, concerts, shopping and cultural events, there is something for everyone -- think Polaris Amphitheatre, Ohio Theatre, Palace Theatre, Polaris Fashion Place, Easton, COSI and the Columbus Art Museum, not to mention the Columbus Zoo, Franklin Conservatory and the Metro Parks.
German Village, Short North and the Arena District are all doing their part to revitalize downtown and draw visitors and businesses. And Mayor Michael Coleman's downtown revitalization plan is an important piece of the "Destination Columbus" puzzle.
While we may never compete with the likes of New York or Los Angeles, if we play our cards right, we can become a major contender.
It takes a great deal of support from the local powers that be to make that happen, including the Greater Columbus Chamber, local big businesses and most important, the citizens. How many of us have visited the zoo lately? Attended a Concert in the Park? Have you seen the new COSI?
It's time for us to put our money where our collective mouths are and support these local landmarks, not just for the benefit of visitors but for those who live here, and value what they bring to our community.
Michael Petracca, managing partner of the Columbus PricewaterhouseCoopers office, says the buyer and seller in a given transaction may be at odds as to how to transact the deal because of differing tax consequences.
"Sellers want to sell shares of stock, while the buyers want to buy the assets of a company," says Petracca.
He says there may be unfavorable results for someone buying shares of stock.
"When you buy stock, you step into the shoes of the shareholder," says Petracca. "That can cause problems because you are assuming all known and unknown liabilities."
Once the seller has the cash, there may not be a way to get restitution for unforeseen liabilities. One way to deal with this possibility is to extract indemnification through a cash escrow to cover potential losses.
On the other hand, as a buyer, when you purchase a company's assets, the transaction is taxable to the seller, while selling company shares is not.
Keep in mind that when purchasing a company's assets, each client under contract must resign that contract. If an important client says no, it could be a major blow. You don't have to worry about that with a stock transaction. So which is the best way to go? That depends on the situation.
"The buyer needs to determine what is best," says Petracca. "Is the stock as valuable as cash? Is it better than cash? It becomes a business decision." How to reach: PricewaterhouseCoopers, (614) 225-8700 or www.pwcglobal.com
JoAnn Sears, sales center vice president for small- and medium-sized businesses at AT&T, says there are more factors to consider than rate per minute.
"Customers are looking for stability and maximizing productivity," says Sears. "Purchasing long distance is not any different than purchasing any other type of technology."
But don't wait until the last minute to make a decision.
"Plan ahead and do some research," Sears says.
She advises decision-makers to go online to see what a variety of long distance providers are offering.
"But read the fine print and make sure you are comparing apples to apples," Sears says.
She cautions long distance shoppers to consider the financial stability of the long distance company.
"You have to ask yourself, 'What will I do if this company goes bankrupt?'" says Sears.
Plus, says Sears a company with a tight cash flow may not have money for research, development and improving or upgrading services.
When looking at that all-important rate per minute, Ray Wendell, voice and LD product manager for Qwest, says to make sure you're including all charges when calculating rates.
"You might be surprised when the other charges are factored in, like minimums, what the rate per minute is," says Wendell.
Like Sears, Wendell encourages business customers to do their homework.
"It's a pretty fluid market right now, so it's worth the effort," he says. "And don't forget to ask your current account rep if you qualify for any new programs."
Also look into bundling services, which can save you money.
"Companies that have data needs may get a better rate if they buy multiple services," says Wendell, and some companies offer discounts depending on your average total bill. How to reach: AT&T, (800) 222-0400 ; Qwest, (614) 798-6000
Young says companies acquire equipment under lease arrangements for four primary reasons: Leasing can reduce up-front cash expenditures, improve the company's tax picture, reduce assets on balance sheets and manage the risk involved with the purchase.
"Those are the primary drivers, along with pure convenience," says Young.
Leasing is especially convenient when a company needs the equipment immediately.
But what is the best option for your company, purchasing or leasing? Young says the first rule is to know the asset and get as much information as possible.
"Know your objectives regarding the acquisition," Young says. "And be able to explain them to your lessor."
There are numerous types of purchase/lease agreements; which type is right for you depends on many factors. There are specific types of leases for transportation equipment, aircraft and construction equipment, as well as computers, barges and mining equipment. Each has its own set of accounting and tax implications that you should know about before signing.
Young advises companies to go to an expert, experienced lender before making a decision.
"Get someone to help you analyze your situation," says Young. "Someone who can understand what you are trying to accomplish and make the best recommendation to get you there."
The bottom line, says Young, is to know the equipment you are acquiring and what you want to do with it, and talk with someone knowledgeable to understand the value of each type of lease arrangement.
"Talking with someone you trust that has the expertise you need is important," says Young. How to reach: Bank One Leasing Corp., (614) 213-6995