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Year-end checklist for finance teams—10 ways to end the year right

The exciting month of December offers a paradox to finance teams. They’re in retrospective mode while also planning for the year ahead. And they’re super busy while hoping to use up any leftover vacation days before the year ends.

Our finance dream team powers through it with some smart planning, to-do lists and the occasional eggnog. Here are a few of the items that finance leaders need to check off this time of year:

Get going on analyzing what you have: Are you set up for impairment analysis? If you haven’t yet identified indicators that could affect your asset valuation, you’re entering the no-excuses zone.

Reflect on your company’s viability: This is also the time you should be ready to assess—and record—your company’s ability to continue as a going concern.

Check in on your vendors: By now you should have access to SOC 1 reports from your third-party providers. Be sure to review what they say about their financial-related controls to consider any adverse impact on your internal controls.

See where you are with recognizing revenue: With all the attention and focus going toward adopting ASC 606, a review of current-year revenue transactions may be overdue. Don’t forget to make sure you’ve kept up to date with documentation around large and unusual transactions over the past year.

Review your progress: As for the new revenue recognition standard, by now you should have well-documented implementation plans, robust testing of systems changes, and a process and information for dual-reporting disclosures. This information is not only required in 10-Ks, but auditors will be really interested to see what companies have to say here. In an alert in October, the Public Company Accounting Oversight Board specifically told auditors to look carefully at what management reports in disclosures and footnotes around their implementation efforts. (This will likely still be an area of focus for the PCAOB even as it transitions to a new board and chairman in 2018.)

Look carefully at stock-based comp: Take a microscope to your equity records. This is about the time when accounting teams tend to get wind of option modifications made without their input. You should also look out for data-entry mistakes (they’re more common than you think!) and any missing paperwork.

Remember your auditors: Any preparation you can do for the upcoming audit will save time and stress later. At this point, you could request the client assistance schedule and start thinking about how you will gather the necessary documents when the time comes. If it’s your company’s very first audit or your first time with a particular firm, you may need to set aside time for educating the auditors about your business.

Reconcile for real: Maybe you’ve been naughty all year by letting reconciliations lag and now’s the time to catch up. Or perhaps you’ve been nice and it’s time to tidy up by reviewing current reconciliations to resolve any issues by the 31st.

Check in on budgets: If you take a “use it or lose it” approach to budgets, some leaders in the company may be buzzing about how they’re going to use theirs up. Reach out with reminders that expense reports need to be submitted on time, and consider whether some teams could carry over their unused budget for more careful spending next year. You don’t want any rash purchases in the waning weeks of 2017.

Know when you need help: This busy time can reveal cracks in the system. Projects that stretch the abilities of staff—or burn them out—often result in errors and missed deadlines. Folding in specialized expertise to take on a one-time transaction (like preparing for the audit) or to help the team get through a busy time is a smart way of efficiently filling a gap and starting the new year off right.

Make your way through this list, and you’ll finish the year on the right foot!

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4 companies make the right moves along the business lifecycle

Every company is at a different stage along the business lifecycle. Some companies have just started out, some are surging forward, some are growing organically and others are fighting against fierce competition.

Where is your company along the lifecycle? It’s important to know so that you can be ready to take on the challenges and opportunities as they come up. RoseRyan has observed after working with hundreds of companies that there are four unique stages:

  • Start: Building the backbone of the business from scratch
  • Grow: Scaling and growing the business
  • Expand: Transforming the business through IPO or acquisitions
  • Evolve: Managing the enterprise through a directional change or other obstacle

Predict ahead
Every new stage along the lifecycle brings on a need for more robust resources or a recalibration. It could involve growing rapidly while attempting to scale for future needs. Or laying the groundwork for an IPO. Or deciding to fold in another company and their team of talent and systems, or needing to scale back and center the company on their core competencies.

Navigating the right financial decisions involves self-awareness-and recognizing where the company is in its journey. “Growth companies and mature businesses require very different operating strategies,” a Harvard Business Review article rightfully noted earlier this year. “Many companies that excel at growth lack the capabilities to make the switch.”

Make the right moves
The fast-moving companies we work with in and around Silicon Valley have reached out to us during critical times in their lifecycle. They’ve needed some guidance. A helping hand. To fill a gap. Or a one-time tackle of a tough situation. If your business starts to take off, it might be a good idea to start review monitoring. You need to know what your customers are saying about your product or service, find out what you can do better, or what you need to keep doing.

Here are four fast case studies of companies in different stages of the business lifecycle, with a particular obstacle they overcame. Depending on your company’s current stage, their lessons learned could help you set your course for a strong future.

A startup needed CFO advice
Usually lean on resources, startups need all hands on deck. For one of our small business clients, this became a noticeable issue when their finance workload was bursting at the seams. Key players wanted to focus on advancing the business, but the needs in finance were pulling their attention away. We actually hired quickfee, a finance company who were really helpful!

They made the right call by asking for help. Our finance pro shared CFO-level insights to help the fledgling finance function run smoothly, and make it so management could direct their attention on crucial strategic decisions. (Read more: “Helping a startup navigate early-stage growing pains.”)

Midsize company navigated rapid growth
How to keep growth momentum going without falling off the rails? The second stage is all about fast growth and how to manage it well. A midsize private company was on the brink of rapid growth and needed a firmer grip on their financial future.

Our interim finance ace set them up with predictive financial models and provided decision-making support for their entire organization, enabling revenue to climb six-fold over two years. (Read more: “Growing from bootstrap startup to big-time player.”)

Tech company prepped for their IPO
It’s a whole new world when an IPO beckons. The third stage of the business lifecycle is that transformative time through going public, making an acquisition or setting up to be acquired. A midsize tech company wanted to get through their IPO, and knew they needed serious expertise to pull it off.

Our finance dream team brought their SEC compliance skills and strategic thinking in order to minimize comments from the regulator and ensure a successful market entry. (Read more: “Sailing through tricky IPO waters and new SEC regs.”)

Enterprise needed a spinoff
As companies evolve, so do the complexities. An international public company turned to us when they were about to make a big change. They needed to carve out a subsidiary as a separate public company that would be based in the U.S. What would the new company look like, and how much would it resemble the past? The result: a newly minted company that could stand its own. (Read more: “Spinning off a cleantech company.”)

When you know the four stages of the business lifecycle, you can better predict and navigate your financial challenges. As RoseRyan CEO Kathy Ryan recently wrote, “Knowing where a company lies along the lifecycle is critical for truly understanding its current and future finance needs.”

Is it time to put the mirror up to your organization? Download our “Navigating the business lifecycle” report, and reach out to us to see if your company is on track.

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Taking companies further, faster—and a fresh new look!

Every once in a while you need a makeover. Companies need it to keep relevant in an ever-changing marketplace. Today is the day for us. We’ve taken a fresh new look at expressing how we help companies in and around Silicon Valley go further, faster with great finance.

Acing their milestones and bringing them to the next level is what we’re all about. And now we’ve better articulated the finance solutions they need to get through the challenging times. We’ve fine-tuned our messaging and refreshed our identity to express more clearly who we are and how we stand apart. Check it out.

Time for a change

In Silicon Valley’s fast-paced, boom-or-bust environment, you have to nail it to stay ahead. We interviewed clients, partners and experts alike to find out what really makes us special. And we wove that feedback into our new messaging.

Here’s what we found out: We’re viewed as a set of finance pros who know the pain points of fast-moving companies, as we have seen and done it hundreds of times. Our experts offer strategic advice, as well as roll-up-the-sleeves attitudes and abilities to get the job done. We help companies get into the fast lane, as we can predict what they will face at any stage of the business lifecycle.

Besides more clearly defining our services, we’ve also refreshed our entire identity and look and feel. Bigger and bolder, our new logo, website, documents and other marketing materials reflect our modern way of thinking. It’s a major makeover that relates much better to our clients and prospects, as we’re speaking their language.

The business lifecycle

RoseRyan helps companies become more successful. Whether they’re advancing to the next stage in the business lifecycle or they hit a stumbling block and need some assistance, we’re right there when they need it.

We hit the ground running with:

A power pack of finance solutions: We bring in the right solution at the right time for the situation at hand. And we help companies of all sizes tackle launch and startup, growth spurts, corporate governance, strategic projects and talent gaps.

A great Silicon Valley finance team: Smart and efficient, our dream team operates at the same quick pace as the fast-moving companies we help. We intimately know the drivers and issues of Silicon Valley companies, so we’re always prepared to jump in to get the job done.

Expertise and insights: Great finance involves constant updates of skills and knowledge (anyone with an CPA knows that). Our pros are life-long learners who lean on each other if they ever get stumped. We love to help clients and prospects with continual communications, ongoing guidance, lunch-and-learns, webinars and intelligence reports. All channels are open.

The companies we help with great finance are in constant motion, moving quickly toward their goals. So are we. The market is dynamic and shape-shifting all the time. So are we. The key is to continue to articulate your value in new and relevant ways to the audiences you care about the most.

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Round of applause for these fast-moving companies meeting major milestones

Every company has a unique journey. They move super-quick at times and then slow down to make their way over obstacles. All the while, they’re chasing after certain milestones that keep them moving forward.

Anytime they reach a milestone—a hard-won funding need, a transformative transaction like an IPO or acquisition, or a strategic shift—it’s a notch toward the next stage in their lifecycle. As finance and accounting consultants who work alongside some of the most exciting, fast-moving companies in and around Silicon Valley, we love when these great moments happen.

Fortunately many of our clients have had recent reasons to celebrate noteworthy achievements. These are just some of the recent wins these fast-moving companies have scored along their journey. Congrats!

AIMMUNE THERAPEUTICS

Our Brisbane client is making strides in their quest to treat peanut allergies. In May, the biopharmaceutical company announced a patient has enrolled in the third phase clinical trial for their investigational biologic product.

INFOWORKS.IO

In San Jose, data warehousing company Infoworks.io closed $15 million in Series B financing. They plan to use the funds to scale go-to-market and customer success programs. Smart thinking!

NEMUS BIOSCIENCE

For this Costa Mesa company, $20 million in proceeds from a recent sale of Series E preferred stock will go toward the continued development of cannabis-based therapeutics that could alleviate certain medical conditions. (Learn more about Nemus with our project profile, “Remote accounting aces for Nemus Bioscience.”)

NOVABAY PHARMACEUTICALS

This Emeryville biopharmaceutical company will have access to more investors because of their inclusion in the Russell Microcap Index. They’re in the process of commercializing Avenova, an eye-care product.

OUTSET MEDICAL

This medical device company in San Jose recently landed $76.5 million in Series C funding. They are scaling up for the commercial launch of their dialysis system.

QUOTIENT TECHNOLOGY

It’s a done deal for this Mountain View media and analytics company after they completed the acquisition of mobile marketing and advertising company Cris Media. They have their eyes on what is predicted to become a $19 billion shopper marketing market by 2020.

STARLEAF

Our Sunnyvale client raised $40 million in funding to support their accelerating growth in the enterprise video conferencing and calling services market. 

VINETI

This San Francisco company secured $13.75 million in Series A funding for a software platform that eases and facilitates access to life-saving cell therapies.

It’s always thrilling to help smart, innovative companies as they make their mark, meet their milestones and advance in their journey. Congratulations to these fast-moving companies!

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We made the list! “Top Workplaces” awards RoseRyan for the third straight year

For three years running, RoseRyan is being recognized as a Top 100 Workplace! This year, we’re ranked 11th in the small companies category, surging up the Bay Area News Group’s Top WorkplacesTM list by 25 spots.

What did it take to get here? It’s all about our employees—they filled out confidential surveys and gave us high marks. Their votes of confidence in our organization is affirmation of our distinctive culture and how we do things. The survey takers concluded RoseRyan has strong overall organizational health and job satisfaction.

Finding the right fit

It feels right. When consultants join our firm, that’s the sense they get. They’re in the right place, at the right time in their career. They’ve accumulated the level of skills and experience in finance and accounting to seamlessly become a valuable part of finance teams in some of the world’s fastest moving companies, leaning on their past experience to deftly solve problems and tackle tricky transactions. Our consultants come in at just the right time to bridge a gap or to help clients get things done. We help companies build solid finance foundations, take the next step forward, meet their milestones and make the right finance moves.

Top Workplaces 2017

The sense of accomplishment our gurus feel as they get things done in the field is just one of the many reasons why our employees are happy here. And it contributes to why, even in this tight talent market, we are able to attract so many new consultants to our dream team.

A magnet for top talent

At RoseRyan, our consultants work in the best of both worlds—stimulated by a variety of challenging assignments at cool companies while also taking part in our own firm’s culture that’s open, supportive and connected.

This year’s Top 100 Workplaces survey results highlight three stellar strengths about our workplace:

  • Alignment: It’s all about teamwork and positive attitudes. Our culture is built upon a clear set of values. Employees feel their work is appreciated and meaningful.
  • Connection: We have a distributed workforce—most of our employees are continuously embedded in various client sites—but we all manage to keep bonded and well-informed about what’s going on, thanks to regular communications from CEO Kathy Ryan and a variety of employee-led special projects and activities.
  • Effectiveness: To achieve the best possible results for clients, we actively encourage different viewpoints from consultants. It’s a smart way of carrying out due process on a solution—and it keeps fresh ideas flowing when employees know their opinions are meant to be heard.

We have a reputation for helping with the right finance skills at just the right moment to calm the chaos or restore order when needed. Perhaps a company is going through a rough patch or needs a gap filled on the team. Our gurus’ natural tendency to “get things done” fast and efficiently from doing it so many times before translates into happy clients. And the positive feedback our consultants receive adds to their job satisfaction.

We love getting things done here in Silicon Valley and it shows. We excel at helping innovative companies reach their milestones, shift gears quickly and surge ahead. And we’re thrilled it’s getting noticed.

Like what you see here? If you think you’d fit right in with the RoseRyan culture and you have the right stuff, we’d love to hear from you. We’re always on the lookout for top talent—full-time and part-time. Contact Michelle Hickam at [email protected].

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Beyond rev rec—planning ahead for 2018 financial reporting

I get it—implementing the new revenue recognition rules has consumed a lot of your technical accounting team’s time, as it has at my company. The new standard likely has a steady spot at the forefront of your audit committee’s accounting concerns as well. It’s a big deal, but other new rules issued by the Financial Accounting Standards Board last year deserve attention, too. They must be implemented in fiscal 2018 if you’re a public company in addition to rev rec.

JulieGilson-LI_image

Planning ahead and maybe even early adopting these new accounting rules could make your life easier a year from now. Presumably (I hope!) you are well on your way in implementing the new rev rec rules, so now may be an ideal time to consider adoption strategies for the other new rules on your plate.

If that concept sounds daunting, take solace in this: You can pick up on the “lessons learned” from your rev rec implementation and apply it to these other implementations, including identifying what new data (and data sources) are required, as well as ensuring you have appropriate internal controls over adoption of new standards. For example, all adoptions require companies to determine if the effect at the adoption date will be material. This requires the computation of the effect to be accurate as well as a process to make sure you have identified the complete population of affected transactions.

Ready to dive in? Here is the next round of accounting changes you need to consider.

1. Changes ahead to cash-flow statements

Let’s start off with ASU 2016-18, which deals with how companies present restricted cash and restricted cash equivalents in the statement of cash flows. It’s not a difficult change to apply, it improves the user’s understanding of a company’s cash position, and it can be early adopted. So, if you have either restricted cash or restricted cash equivalents this year or in previous years, why not adopt now?

The standard can be adopted in any interim quarter. Keep in mind it must be applied retrospectively—whether you do it now or in Q1 2018, you are going to have to restate your statements of cash flows for prior years.

While you’re at it, ASU 2016-15, which also deals with reporting in the statement of cash flows, allows early adoption with the same retrospective transition rules. It makes sense to adopt both ASUs at the same time as users would likely prefer to see all changes reflected at once.

ASU 2016-15 is worth a review to see if any of the eight cash transactions it specifically calls out apply to you. The transaction types are not all infrequent among the companies I work with—two, for example: amounts paid to extinguish debt, including prepayments and payments for contingent consideration in a business combination. If you’ve got those, you may have some changes ahead of you.

And early adoption is not just an idea for public companies; it might also make sense for private companies as they will have to adopt no later than 2019. If you’ve got an IPO in the future, adopting now is one less change you’d have to make before taking on public-company GAAP.

2. Got a deal coming up? Is it a “business” or an “asset”?

ASU 2017-01 defines a business as opposed to an asset in transactions involving acquisitions, transfers, or disposals of a set of assets and activities. It’s another of the FASB’s projects for making transactional analysis more efficient by narrowing the definition when applying the rules for business combinations.

This one is also required to be adopted in 2018—prospectively—so it will apply to transactions on or after the adoption date. But if you expect to have a transaction sometime during the rest of 2017, definitely take a look at whether this new standard will affect your accounting in a way that makes more sense for your company’s situation.

Pundits are predicting that more acquisitions will be accounted for as acquisitions of assets, rather than business combinations. The differences in accounting are significant—for example, transactions accounted for as asset acquisitions will not have goodwill recorded but will require you to capitalize transaction costs.

While this is the first in the FASB’s project to define and clarify what a “business” is, keep in mind that the definition of a business also comes into play for identifying reporting units for goodwill impairment tests and consolidation.

3. Impairments and intangibles

Segueing into the subject of impairment, simplified rules for impairment analyses of intangibles, including goodwill, in ASU 2017-04 are also available for early adoption this year, prospectively, for any impairment measurements performed in 2017 for financial statements not yet issued.

The new rule removes the requirement to perform a hypothetical purchase price allocation, which involves determining the fair value of the individual assets and liabilities. Now, you can do a much simpler measurement by comparing the fair value of the reporting entity as a whole to its carrying value.

4. An accounting change for some equity investments

To fill out the rest of your technical accounting implementation work plan for Q1 2018, ASU 2016-01 affects accounting for equity investments classified as available for sale, which is not an uncommon investment.

It requires companies to record all changes in fair value, including impairments, in the income statement—not in other comprehensive income as we do today. This is going to mean more variability in earnings, so investors will need to be educated about why they’ll see changes.

Know that this is the one ASU on this list that cannot be early adopted. The standard has other provisions you should take a look at, too.

 

Do the work now, thank yourself later

With all these changes, keep in mind you may have more than just rev rec and the new accounting rules for leases affecting your ongoing SAB 74 disclosures, as well as planning for disclosures required under ASC 250 when adopting any new accounting standard.

My best advice? Plan ahead, and do what you can to be in front of the work. Keep your team and audit committee informed of what to expect. This way you’ll avoid surprises and an overwhelming workload for first quarter 2018.

Get the scoop on the accounting changes in store with the RoseRyan Technical Accounting Group’s fast-paced 90-minute webinar session, “Our Take from the Trenches on the Latest FASB Updates and What You Need to Know.” Go to bit.ly/FASBupdates to register for this webinar taking place Thursday, June 15, 10am-11:30am PT. 

Julie Gilson is a senior consultant with RoseRyan and a CPA (inactive) with over 15 years working in finance and accounting with fast-moving public and private technology companies. 

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Deal flow in the PE market continues to move—here’s why

What’s hot in the deal world at the moment? The fintech sector continues to generate steam and so is another industry, the wine business. Private equity investors’ interest in turnarounds has diminished somewhat, and they are instead prioritizing growth and control in their investment strategies.

These were just some of the noteworthy learnings and interests expressed by private equity firms during the Association for Corporate Growth’s (ACG) West Coast M&A Conference in San Francisco this spring. As they networked, attendees said they’re seeking deals that typically have 10% of revenue EBITDA or a total of $3 million to $15 million of EBITDA at a minimum. Optimism is high with expectations that we’ll see deals continuing to flow but possibly slow down toward the end of the year.

Here are the highlights of what’s on dealmakers’ minds at the moment—most of the conference attendees represented firms seeking deals in the $5 million to $100 million range. The firms represented at least five states including many from New York, Massachusetts, Arizona, North Carolina, Connecticut and, of course, California.

An active market

Deal flow continues to be strong, and everyone is seeing lots of activity, according to participants of the keynote, who included Dipanjan Deb of Francisco Partners, John Kim HIG of Growth Partners and Dave Welsh of KKR.

The overall belief is that the past two years have been particularly fruitful, and that opportunities will slow down toward the end of the year as a result. The innovators of the fintech market are getting attention, leading to one of the most robust deal areas as the entire banking system is disrupted by these strong niche players.

Success vs. failure

There are some big deals to be had in the PE space. Darren Abrahamson of Bain Capital emphasized that the talent of the management teams is a critical factor in the success or failure of a deal. Everyone during a panel that included Abrahamson, Heather Madland of Huron Capital, Greg Clark of Symantec and Mark Grimse of Rambus hit on this theme: No matter how big the transaction—the outcome ultimately comes down to management’s ability to execute pre and post deal.

Moreover, they went over what derails some deals—inadequate systems and processes can take much of the blame. The panelists emphasized that successful companies need a strong understanding of their core competency (high value add) versus other strengths of their business.

A different varietal of M&A

The wine industry has had a tremendous number of deals over the past year, and owners believe it’s hitting a peak. This industry is extremely “high touch” and relationship driven due to the family nature of ownership, noted panelists who focused on this topic, including Adam Beak of Bank of the West, Pat Roney of Vintage Wine Estates and Richard Mendelson of Premium Wine Properties.

The business model of three-tier distribution comes into play as well as cash flows that can be varied across different properties. Money is not the only thing that is driving high valuations—brand and locations are key factors as well.

The road ahead

This M&A Conference had a positive tone. Deal flow this year is very strong due to the low cost of capital and the overall optimism in the economy. Overall the PE market continues to chug forward as the cost of money and quality of deals are favorable. There are some niches doing particularly well (fintech) and few areas are struggling. Valuations seem to be both beneficial to both the PE firms and companies.

Chris Vane is a director at RoseRyan, where he leads business development for this finance and accounting consulting firm’s high tech and cleantech practices. He helps fast-moving companies calm the chaos with precision finance at any stage. He can be reached at [email protected], or call him at 510.456.3056 x169.

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SOX is ever-evolving: 5 ways to shore up your controls program

Talk about mixed messages. The new presidential administration wants what they consider “costly and unnecessary regulations” wiped out. At the same time we have continued pressure by regulatory agencies to strengthen and improve internal controls over financial reporting (ICFR). Anyone who is involved in SOX compliance has to wonder: Is the almost 15-year-old law part of the discussion in Washington? And what should we all be doing in the meantime?

Our crystal ball isn’t any less cloudy than yours, but here’s some advice. Keep in mind SOX’s goal—to have in place a strong ICFR system that prevents a material misstatement of the financial statements. To what extent this is mandated may be in flux, but the benefits of such a program are foundational. It’s good for your valuation, as well as management, employees, investors and anyone you do business with.

 

To keep your SOX program doing what you need it to do, know that it needs to evolve. As your business expands, its interests and risks shift, and leaders come and go, your SOX program needs tending to as well. Here are five ways to make sure yours stays up-to-date, no matter what happens on Capitol Hill.

1. Pay attention to your culture.

Culture plays a huge role in ICFR. What are the expectations for ethical behavior in the workplace? Are these embedded in your workplace culture? Is the pressure to deliver results so great that a blind eye is turned to questionable behavior? These are important questions to ask regularly, as the answers may change when leaders come and go, and the company grows more complex.

No matter how strong your design of controls, without a healthy ethical environment, your ICFR program will be fighting an uphill battle. Tone at the top matters. “In most cases of alleged financial fraud, the CEO and CFO are named in the complaint,” according to a March report from the Center for Audit Quality. “[Securities and Exchange] Commission staff noted that the driver of earnings management—the catalyst for most fraud cases—is often top management, such that the focus on the CEO and CFO is not surprising.”

In addition to the tone set by the senior leadership at headquarters, look at the culture of remote offices, both foreign and domestic. Take into account both the local tone at the top as well as customs and practices and any incentives offered to local leadership for achieving performance goals.

2. Revisit your company’s risk profile.

Business risks change. Are you staying current? Identify anticipated changes in business processes, systems and key personnel, and make sure you are addressing any known areas of risks that need attention. Even if your internal environment is stable, assess how your business risks may have changed due to external factors.

3. Adopt a quarterly review process.

Keep the people responsible for key controls engaged all year long. By carrying out quarterly self-assessments, control owners can get a quick read on areas that are changing and controls that no longer serve the organization. These evaluations can also help prevent surprises when it comes time to test the controls.

4. Seek alignment with your external auditors.

Expectations can change, so stay fluid. The regulatory landscape will continue to evolve as new leadership takes shape at the SEC and the Public Company Accounting Oversight Board, and their priorities and interests are passed down to auditors. Understanding changes in your auditors’ expectations and having clear, proactive communication can make all the difference in your ability to retain an effective SOX program.

Some of the more recent areas of focus by your auditors may include IPE (information produced by the entity) and the related scrutiny to ensure that the data is complete and accurate. In considering the completeness and accuracy of information used in the execution of a control, it is important to pay attention to the relevant data elements.

5. Fold in insights from experts who bring another perspective.

When your external auditor asks for additional controls, how can you tell whether it’s a check-the-box request? What’s a reasonable risk-based response? You can use a co-sourcing finance team as a sounding board to help you formulate the appropriate answers. Experts who work with a variety of companies can offer a broader perspective of what is going on in the industry.

And for smaller companies that need to rely on a single employee for subject-matter expertise, outside experts can fill in knowledge with their “second set of eyes,” such as by evaluating the design of controls or reviewing a complex, nonstandard transaction.

Regardless of whether SOX as we know it goes away or is here to stay, savvy companies will want to keep the benefits of strong, right-sized internal controls.

Pat Voll is a vice president at RoseRyan, where she mentors and supports the dream team, and heads up client experience, ensuring all our clients are on the road to happiness. Pat previously held senior finance level positions at public companies and worked as an auditor with a Big 4 firm. 

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Culture and Innovation Trailblazers—How 5 Companies Are Defining a New Path

There’s nothing quite like working in the San Francisco Bay Area. Innovation is happening all around us—and as consultants, we get to see it in person every day working with our clients. Tomorrow’s must-have apps are on the drawing board, some awe-inspiring ecommerce service is about to go live, and life-saving devices are going through their approval paces all the time.

Dig deeper and you’ll see innovation on many fronts beyond the products. These businesses are also disrupting the norms of the traditional workplace, adopting different definitions of what “work” looks like and creating notable cultures.

We saw it play out during the recent NewCo Bay Area festival, a multi-day distributed conference where we got to visit some of the most innovative and meaningful businesses in the Bay Area to see and hear what makes them tick. The five companies below have created engaged workforces and cohesive cultures.

Adobe

Adobe’s marketing and document solutions have enabled creativity for countless companies.

During a panel discussion at Adobe’s San Jose HQ, we heard a range of viewpoints on “the future of work,” with speakers from several organizations, including Adobe, General Motors Advanced Technology and even the mayor of San Jose.

The talk brought up a newer challenge for any team tasked with attracting and retaining in-demand talent. Today’s job candidates are not prioritizing money or profitable businesses—they are seeking meaning in their work (a common theme of NewCo companies). Passion vs. paycheck is a constant query for those on the job hunt.

Plum Organics

Acquired by Campbell Soup Co. in 2013, this 10-year-old company makes nutritious organic snacks and meals for babies and toddlers.

We got a private tour of Plum Organics’ newly remodeled Emeryville office space. It aims to be a healthy, happy workplace that entices employees to want to spend their time there—not just because they’re expected to show up every day.

While some companies tiptoe around the concept of a distinct culture, in reality they are focused on actually having one (sounds familiar to us!). Plum has a collective vision of who they want to be and how they want working there to feel. To pull it off, they encourage “shout-outs” of praise across the company that can be made by anyone (not just management) and an empowered workforce that manages their own time. They also follow four core value: BYOS (bring your own self); lead with heart; fight the good fight; and use business as a force for good

As longtime followers of RoseRyan’s core values, we admire Plum Organics’ dedication to nurturing and developing their culture.

Foundation Capital

This venture capital firm has supported the fast growth of companies like Netflix, MobileIron, ShorTel and others in the fintech, marketing technology and enterprise tech spaces.

In the firm’s San Francisco office, general partner Steve Vassalo told us why he was specifically hired for his design background. We think this is an interesting development in the tech industry. Their firm foresees an uptick in the number of designer-founded startups, and predicts their unique experience will lead to better user experiences all around. Consumers will see the effects of this trend as the Internet of Things continues to take off in the many appliances we use.

Like other firms that are transforming the concept of culture, this VC firm believes a focus on love and trust in the organization enables growth—rather than solely focusing on growth itself.

Stimulant

A creative interactive design agency turns static physical spaces into dynamic interactive environments.

As Darren David, CEO of this San Francisco firm told us, people are seeking experiences more than attaining things. That’s why there’s a heightened interest in virtual reality. However, the VR industry has mostly focused on creating a silo experience that shuts out users from reality and anyone in real life while they wear those nifty headsets.

Stimulant wants to create alternate realities that can be experienced together, therefore bringing people together. How do environments encourage collaboration? Stimulant is asking this question as companies benefit from figuring out how to drive more face-to-face interactions between their workers.

WeWork

Providing work environments where remote workforces can go for a change of pace, meetups and a collaborative atmosphere.

We checked out WeWork Transbay, seven floors of coworking space and amazing views of downtown, the Bay and lots and lots of sunlight. The open floor plans, glass office, community area and weekly social events foster collaboration among coworkers and people working from entirely different companies. Imagine the chance meetings and creativity that naturally bubbles up around today’s version of the water cooler—the entrance to a meditation room.

At RoseRyan, our consultants get to work alongside some of the most innovative tech and life sciences companies in the Bay Area, becoming an essential part of their finance teams, such as when we’re controllers for emerging growth companies or helping with a liquidity event. No matter what we’re doing, we are guided by our firm’s distinctive culture and fascinated by the shifts in work trends we see evolving.

Tracey Hashiguchi heads up RoseRyan’s emerging growth and small business team, a dedicated group of consultants helping companies launch and grow. She develops RoseRyan’s strategy, programs and consulting team for helping startups get to the next level. Before joining RoseRyan, Tracey worked at Deloitte.

Our marketing coordinator Lauren Kershner keeps the marketing engine humming at RoseRyan. She joined the team in 2016 and runs our campaigns and programs, digital marketing and more, and she brings lots of positive energy to the office.

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Tales from the front lines in CFO and controller recruiting—what’s expected these days

A CFO who is good at financial integrity management but struggles with assessing situations and being visionary won’t be a CFO for very long. I see CFOs facing this challenge in companies of all sizes, from Fortune 500 companies to startups.

In my role on the RoseRyan management team, which includes interviewing candidates, and as a CFO consultant at various companies, I get the chance to interface frequently with other CFOs and recruiters. It’s a great way to stay on top of trends in senior finance roles. CFOs who take a strategic approach to the position have been in demand for awhile now at the largest of companies, and now smaller and medium companies are following suit. And controllers, another key role in finance organizations, are expanding the skills they need as well.

Starting at the top

During a recent FEI event in San Francisco that focused on the state of the market for Fortune 500 CFOs, executive search recruiters revealed that, not surprisingly, these companies take a different approach to recruiting CFOs than smaller companies. Many of them, in fact, recruit from within. Today’s recruiters spend more of their time assessing talent than finding it. This makes sense, because today more than ever, CFOs need to be strategic and analytical.

And CFOs aren’t the only ones getting held to a new standard. Controllers need to acquire these skills, too. Basic accounting has become so automated that the art of being a good controller has changed from just closing the books to understanding and interpreting the information at hand and navigating through lots of different situations.

In many cases, controllers and CFOs need to gather new information to help with their decision making. Technical skills are in great demand—but “technical” in this instance means the ability to gather and interpret new data from various databases and other sources. Needless to say, great communication skills are essential for anyone wanting to secure a senior finance role. To build a well-rounded and influential finance team in any organization, such capabilities are a necessity.

The takeaway for smaller companies

Fortune 500 companies that recruit from within focus on placing CFOs who have a proven ability to build relationships. This isn’t usually an inherent skill—it can take a number of years to achieve. They also look for a CFO’s understanding of the internal machinations of the organization, and they want a good cultural fit. These are all areas that smaller companies should consider, too. I find that a lack of cultural and emotional alignment is the biggest reason CFOs fail in companies, which is why recruiters take those elements into account up front.

The trend of CFOs becoming more strategic and analytical is well cemented in recruiters’ handbooks. The need for controllers to be strategic and analytical may not be as widely known, but it’s also becoming a trend. In my view, this trend will accelerate over the next few years. RoseRyan is already taking into account these skills and how the market has moved in our recruiting activities. Candidates need to have technical, strategic, analytical and soft skills to get hired, as our clients smartly demand these in today’s market. This demand is only going to increase.

Looking for a change? Do you have the mix of skills to fit in with the RoseRyan dream team and the fast-growing finance teams around the San Francisco Bay Area? If so, we’d love to hear from you. We’re always on the lookout for top talent—full-time and part-time. Contact Michelle Hickam at [email protected].

Stephen Ambler is a director at RoseRyan, where he oversees the CFO practice area and handles client CFO requests. He has over 30 years of experience helping a wide range of companies with their financing needs. His interim CFO stints at RoseRyan have included a social media company and the management of the financial integration process at a company acquired by Oracle. He previously held the CFO position for 13 years at NASDAQ-listed companies.

 

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