Opinion
The Financial Accounting Standards Board (FASB) is studying replacing annual goodwill impairment tests with a straight-line amortization model, presenting CFOs at financial institutions and other companies with two pressing choices: whether to continue regularly performing reporting unit valuations (even if no longer mandatory for impairment testing), and if so, whether they should be conducted by a third party. An EY Americas survey shows that 53% of CFOs plan to continue annual valuations, but only 25% use valuations to judge whether stocks are overvalued or undervalued. This article suggests that third-party valuations can bridge internal skill gaps, provide unbiased performance assessments, and help CFOs navigate capital allocation challenges amid digital transformation.
As investor attention on ESG information continues to rise, how companies can effectively conduct ESG reporting has become an important topic. Based on industry practices, this article proposes a five-step approach from focusing on material indicators, researching peer disclosures, developing thematic principles, to developing content and visualization, and offers specific recommendations for different disclosure channels such as websites, proxy statements, 10-K filings, and CSR reports.
Technology companies are moving from subscription-based or perpetual licensing to consumption-based pricing with 'pay-as-you-go' structures. Rachel Parrinello, Chris Semain, and Ted Grossman of Alexander Group outline four mainstream models: no-contract, no-commitment contracts, hybrid contracts with commitment plus no commitment, and committed funding pools. They identify revenue cannibalization, changes in coverage models, reduced revenue predictability, tracking system upgrades, and sales compensation design as the five core challenges in the transition. The article advises CFOs to drive progress collaboratively across four dimensions: planning investment, sales strategy, compensation plans, and reporting systems, and emphasizes that this model is not universally applicable, requiring an assessment of whether products are suitable for breakdown into measurable service units.
As the pandemic accelerates the adoption of B2B marketplaces, corporate financial executives need to carefully evaluate when formulating related strategies. This article raises three core questions: clarifying the target market type, assessing growth potential, and ensuring the scalability of products and services, supplemented by industry data and successful cases to provide a reference for decision-making.
Data product success depends not only on analytical assets but also on management principles. Drawing on their hands-on experience at Medidata, the authors propose four key elements: defining problems with core product management principles, ensuring actual adoption with a customer-centric approach, building a cross-functional collaborative culture, and designing frameworks for scale.
While subscription-based business models bring predictable revenue, they also cause sales tax compliance risks to accumulate repeatedly with each billing cycle. With over 13,000 tax jurisdictions in the United States having varying rules, more than 450 ways to tax software and SaaS, complex tax rate determinations between physical and digital delivery, and tax rates varying down to the street level based on customer location, businesses need to be vigilant against multiple risks. CFOs or revenue leaders should prioritize integrated automated tax solutions to reduce compliance burdens and focus on business growth.
The Great Resignation is impacting corporate profitability and strategic planning, with CFOs at the forefront of the response. A PwC survey in August showed 65% of employees are looking for new jobs, and 88% of executives reported abnormal turnover rates. An Oracle survey indicated that 88% of employees believe the definition of success has changed, and 85% are dissatisfied with employer support. CFOs need to address replacement costs (which can range from six months to two years of salary), adjust operating models, invest in automation technology, and develop flexible work and security strategies.
Against the macroeconomic backdrop of high inflation, SPAC investors are exercising their redemption rights at an unprecedented pace. Data shows that the redemption rate in the second quarter of 2021 has jumped from about 10% in the first quarter to over 25.1%. This article analyzes the underlying logic behind the redemption wave from perspectives such as inflation, geopolitics, and the evolution of SPAC governance structures, and points out that the current environment is fundamentally different from a typical 'mania bubble'.
Over the past 18 months, global supply chain disruptions, recurring economic activity fluctuations, near-zero interest rates, and climate risks have completely transformed the operating environment for corporate treasury. CEOs and CFOs increasingly rely on treasury as strategic leaders, requiring capabilities in collaboration, digitalization, communication, and innovation.