Around $100 billion — that’s how much the U.S. treasury loses each year as a result of corporations’ addiction to offshore tax havens, according to Senator Carl Levin (D-MI).

Levin and Reps. Rosa DeLauro (D-CT), Lloyd Doggett (D-TX), and Sander Levin (D-MI) want the Obama administration’s fiscal year 2010 budget to include an array of measures aimed at shutting down what they describe as “offshore tax abuses.” more

Among the different subjects touched upon in a recent Business Finance interview with Flowserve CFO Mark Blinn, we thought that Blinn’s comments surrounding budgeting and forecasting may hold special interest for finance professionals. Here’s a short excerpt:

Steve Player: What role does the budget play in your operation? Do you see yourself moving to a rolling forecast?


Mark Blinn: The budget’s a commitment, a benchmark, an expectation that you talk from. And it becomes obsolete the day after it’s approved for purposes of the forecast. This is a very important point, because companies historically have managed to the budget. But a lot changes in most businesses three months after the budget’s complete, and if you’re managing to the budget, you’re managing to three months ago. more

The best definition I’ve heard of a business case is that “It’s the lies people tell to get funding.” And that is the truth.

Growth is high and expenses are low, leading to unreasonable expectations in the majority of business cases. So what is the key to reducing the lies that people present in business cases?

It comes down to tracking what they deliver, e.g., benefits realization, tracking actuals, etc. Roger Goodell, commissioner of the National Football League, has a good suggestion on this. When talking about the New England Patriots videotaping opponents’ signals, he stated,

“The most important thing is to take decisive action. We discovered that they were taping the signals of visiting coaches, which is against our rules, and we made very clear that it was not going to be permitted. [Patriots coach Bill Belichick was fined $500k and the team was fined $250k and denied a draft pick.] Sending a message that you’re going to enforce the rules is the best way to deal with integrity and make sure that our fans understand that games are going to be played by the rules.”

When it comes to investments in projects and initiatives, companies rarely hold folks accountable, ensuring that the cycle of lies and rosy projections continues. Instead, they should take a page from Roger Goodell and reward those who deliver and “punish” those who don’t. The punishment can take the form of reduced funding going forward, greater oversight, or even diminished responsibilities or dismissal. Only by doing this will you ensure that people come with their best ideas and are incentivized to put forward their best ideas and deliver per their business case. ###

Once upon a time, in a kinder, gentler work world, companies staged Friday afternoon retirement parties where the boss presented veteran employees with a shiny watch and a handshake as the new retiree fantasized about catching “the big one” or shooting a hole-in-one with all that great leisure time ahead.

Flash forward to 2009, when workers between 56 and 65 have a very different goal — working long enough to recover recent losses sustained in their 401(k)s. Older workers have been particularly hard hit by the financial crisis, primarily because they don’t have the necessary time to earn back the money they lost. more

Treasurers and financial executives at more than one-third of companies –- 39 percent -– measure their firms’ liquidity weekly or even daily, according to a recent survey by Deloitte. At the other end of the spectrum, nearly 32 percent of respondents either didn’t know how often their firms measured liquidity or said that the question didn’t apply. About one in five measures monthly.

Of course, no single formula can determine when every company should count its money. However, with the economy tight and sales hard to come by for most firms, this is one area where improvements can help the bottom line. “Working capital is a key element of value in a lot of companies,” says John W. Little, principal with Deloitte’s reorganization services group. Now is an opportune time to review internal processes with an eye toward making them more efficient, he adds. more