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CAREERS & RECRUITING
Can You Ask for
Severance?
The saying “last hired, first fired” might creep into your head as you think about changing jobs, but the current staffing shortage in the accounting and finance sectors has put CPAs in a prime position to negotiate severance.
Dona DeZube of JobsintheMoney.com, a career Web site for accounting and finance professionals, says, “If you’re a below-C-level employee, a golden parachute may be beyond reach. But you may be able to get a golden umbrella that protects you if it starts raining pink slips.”
DeZube suggests researching the compensation packages of others with the same background—including accounting skills, experience and certifications—before starting negotiations.
Source: “Negotiating Severance Upfront Can Be Tricky,” www.jobsinthemoney.com. |
TAX NOTES
Give and Take at the SSA
Starting in January 2008, the maximum earnings subject to Social Security tax will rise 4.6%, from $97,500 to $102,000, marking the first time the taxable maximum exceeds $100,000. The Social Security Administration expects nearly 12 million workers will pay higher taxes as a result. The $4,500 increase in maximum taxable earnings surpasses the $3,300 increase from 2006 to 2007.
On a salary of $102,000 or more, the Social Security tax in 2008 will be $6,324, up $279 from 2007’s maximum of $6,045. The tax rate of 6.2%, established in 1990, will not change.
The SSA also announced a 2.3% cost-of-living adjustment on benefits payments in 2008 based on the Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers.
Source: Social Security Administration, www.ssa.gov.
THE WORLD’S DUMBEST FRAUDSTERS
Your Check Is in the Mail
Sabrina Walker of Minneapolis must have been one happy camper—at least for a while. It seems that in March the state of Minnesota inadvertently cut a $2.5 million check to her instead of the Hennepin County Medical Center, the intended recipient.
Walker’s only other dealing with the state’s accounting system was an $84 check she received as a court witness. But as luck would have it, her vendor number was one digit removed from the hospital’s nine-digit number, and a clerical error in the state’s accounting system sent her the millions.
Rather than return the money, Walker allegedly bought a $500,000 certificate of deposit, and later, a Treasury bond of the same amount. She went on to buy four automobiles and spent another $5,500 on jewelry, $3,817 on electronic equipment and $2,069 on limousine services. Prosecutors charged Walker with theft by swindle and concealing the proceeds of a crime.
—Joseph T. Wells, CPA, CFE
BUSINESS TRENDS
More Nest Eggs Are in
Retirement Baskets
According to The U.S. Retirement Market report from the Investment Company Institute, retirement assets accounted for nearly 40% of household financial assets in 2006, compared with 24% two decades ago.
The report also revealed that the bulk of these assets are held in employer-sponsored plans or originated there, with 64% still held directly in the plans.
Source: Investment Company Institute, www.ici.org. |
TONE AT THE TOP
The CFO Shuffle
While volatility of movement in the
C-Suite is at its lowest level in more than 10 years, CFO turnover continues to exceed that of CEOs.
Crist Associates, a senior level executive search firm, examined CEO, COO and CFO movement at 657 companies listed on the 2007 Fortune 500, S&P 500 or both. Based on turnover rates from Jan. 1 through July 31, its annual Volatility Report predicts the departure of 84 CFOs and 75 CEOs this year.
| CEO vs. CFO Volatility |
| Year |
CEO |
CFO |
| 2002 |
71 |
111 |
| 2003 |
66 |
88 |
| 2004 |
89 |
94 |
| 2005 |
95 |
110 |
| 2006 |
83 |
87 |
| 2007* |
75 |
84 |
| * Based on rate of change observed from
Jan. 1 through July 31. |
Source: Crist Associates’ Volatility Report 2007, www.cristassociates.com. |
IN THE SPOTLIGHT
BAP Rewards Problem-Solvers
Beta Alpha Psi members are getting an opportunity to gain some real-world experience and raise funds for their chapter.
“Project Run With It,” a case competition, will be held Aug. 7, during the BAP Annual Meeting in Anaheim, Calif.
The competition, sponsored by Moss Adams LLP, brings together students from 60 chapters to develop solutions to the financial and technological problems of three not-for-profit agencies.
The organizations provide background information and answer student questions. Then, the students, working in teams of four, have one day to develop possible solutions and present them to the agencies.
Each chapter can nominate one person to participate. Nomination forms, available at www.bap.org on Feb. 1, are due May 1. Then, the nominee must meet with a director of a local not-for-profit agency and submit a one-page essay summarizing the meeting and identifying how his or her BAP chapter can assist the organization.
Final choices will be based on service to BAP, grade-point average, the essay and a statement of commitment to attend the annual meeting. Students will be notified of their acceptance by July 1.
Each member of the winning team receives a plaque and a $1,000 award for his or her chapter.
Source: Beta Alpha Psi, www.bap.org. |
BUSINESS TRENDS
Tell Us What You Really Think
In the third quarter this year, almost 80% of corporations purchased a variety of services from non-Big Four audit firms, often using them for multiple services, according to a survey of 220 CFOs from both public and private companies. Purchased services included:
 Tax (74%)
Auditing (68%)
Consulting (36%)
Information Technology (10%)
Human Resources (8%)
Other in-demand services included benefit plan auditing, SOX compliance testing, transfer pricing, and mergers and acquisitions due diligence.
Source: CFO Outlook Survey, 2007 third quarter, Financial Executives International and Baruch College’s Zicklin School of Business, www.cfosurveys.com.
DATA
POINT
39
Companies whose securities have been suspended from trading since the launch
of the SEC’s Anti-Spam
Initiative on March 8.
Source: www.sec.gov. |
CAREERS & RECRUITING
Preventing No-Shows
The 2007 CCH Unscheduled Absence Survey found that to combat unscheduled absenteeism, U.S. companies offer an average of nine work/life programs, though each varied in its effectiveness, and the most effective programs are not necessarily the most frequently used.
The programs rated highest for reducing unscheduled absences (on a scale of one to five with five being the most effective) are alternative work arrangements (3.6), telecommuting (3.5), compressed work week (3.3), leave for school functions (3.2) and flu shot programs (3.2).
The top five in use are employee assistance plans (72%), flu shot programs (66%), wellness programs (60%), leave for school functions (54%) and alternative work arrangements (54%).
Source: 2007 CCH Unscheduled Absence Survey, www.cch.com/absenteeism2007. |
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