If you were the CEO or CFO of a public company, how would you make the decision on whether to report potential violations to the SEC?
According to the article, Target’s profitability suffered in part because of the rigid performance metrics that were introduced. Explain how introducing performance metrics can alter employees’ behavior and affect the “creative culture” that Target had. What financial ratios would capture reduced performance?
Can you think of other ways that tax policy drives corporate decisions, in addition to the decision to relocate HQ to overseas, such as Medtronic’s planned acquisition of Covidien?
Good ideas for working capital management are in this article. As you explore career options, does this type of work (CFO, internal accounting) appeal to you?
Should boards of directors diversify? Why or why not? What are the potential benefits of a diverse board of directors? Why do you suppose Skechers and Monster have not followed through with diversification?
Given the length of time on the joint revenue recognition project, what does the new revenue recognition standard suggest about collaboration between the FASB and the IASB? Will the new standard improve accounting? If so, how exactly?
Do you believe that the disclosure about conflict minerals will be useful? How would you define useful?
How would you have voted on Chipotle’s executive compensation pay plan? Is $25 million for the CEO “too much”? How would you decide if pay is excessive?
What is your opinion about Walmart’s use of non-GAAP measures in deciding whether or not bonuses are paid?
In your opinion, is the use of non-GAAP measures in an IPO misleading? Or, is it truly helpful? If the latter, do you think GAAP is deficient? Should, for example, the measure of “free cash flow” be standardized by the FASB if it is deemed relevant for investor decisions?
Why would banks use net debt-to-EBITDA as a constraint on borrowing? What is a common characteristic of those firms that are already highly levered (with a ratio above 5)?
Should the SEC force companies to adopt SASB standards, in addition to FASB standards? If you were a CEO, would you voluntarily use SASB standards? What are the costs and the benefits of using SASB standards?
How would you interpret the data re: revenues and capex? What other data or ratios would help you decide what’s happening? If you were the CEO of a firm, how would you set your capex budget?
Why does the author consider the joint IASB/FASB revenue recognition to be the most successful one yet? How would you measure success on these joint projects?
If a firm has so much cash, why do they borrow more cash to pay a dividend to shareholders, or to buy back stock? Do you support a territorial tax system? Why or why not?
If you were the CFO of a publicly traded firm, would you want a DB pension plan or a DC? If you were an employee, which would you prefer? How will the increased longevity wind its way through to the financial statements? That is, what accounts are affected, and how?
