Playing Chicken With the American Economy
December 13, 2021

Some of you (likely the more seasoned readers or maybe the classic movie buffs out there) may remember the 1955 movie Rebel Without a Cause. The movie features a famous scene in which star James Dean’s character races another driver toward the cliff of an abyss. The first to jump out of his car to avoid going over the edge would be deemed a “chicken.” Sound familiar?

It probably should, as it is essentially what’s happening in Washington right now among politicians in their attempts to resolve the problem of the fiscal cliff. As we quickly approach the edge, politicians on both sides continue to reposition their stances and it’s clear that sizeable differences still remain. In essence, we’ve witnessed how the polarization of our political system has created a game of “chicken” with our economy.

What we’re faced with seems to be two sides speeding in separate cars towards the edge of the cliff, with the possibility of both driving off of it together. Instead of trying to outlast one another, the opposing sides need to realize that they aren’t driving different cars, but are rather sitting side by side in the same one. Despite all of the damaging economic ramifications of going over the fiscal cliff – a significant fiscal drag, markets diving, falling back into a recession, a global economic slowdown – there is an opportunity here for us as a nation.

As an accounting and business advisory firm, we’ve heard more than most about our clients’ fears. If a deal isn’t made in a timely manner, businesses will ultimately face the consequences. This is a chance for our political leaders to come together and show the country that compromise is still possible. Regardless of your politics, when it comes to driving towards the fiscal cliff, we’re all in that same black 1949 Mercury Club Coupe. No one will benefit from us kicking the can down the road and driving off the cliff.

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Hats Off…
December 10, 2021

Last week we hosted our third annual Audit Committee Forum. This year’s program came from discussions with our clients, current industry trends and feedback from last year’s attendees. Our goal was to provide forward thinking and innovative ideas to enhance audit committees’ operations and provide attendees with the guidance necessary to be more effective.

We are committed to sharing valuable information – with our clients, colleagues, friends, the industries we serve and the CPA profession – so we’ve shared insights from the forum (http://www.parentebeard.com/auditcommitteeforum/) to inform and educate members of audit committees and boards of directors on the current best practices for businesses in this uncertain economy.

In today’s fast moving environment, risk management is critical for CEOs and boards. Regulatory authorities are constantly issuing new requirements that mandate more explicit information on risks and risk management practices. Combined with the heightened scrutiny brought on by recent negative headlines about well-known companies such as Groupon, Amazon, Google and, surprisingly, HP and Autonomy, boards and committees are feeling more pressure than ever before. These individuals now face the same scrutiny for failure to comply with expected standards and will be held just as accountable as the companies they serve.

The interplay of the various risk and compliance requirements forces companies to go beyond managing risk in silos and create an integrated risk management function. In other words, instead of wearing just one hat in a particular area of expertise like marketing or finance, members of an audit committee are forced to wear many hats. The issues are all connected.

While risk can never be eliminated, companies that move beyond traditional risk management to implement more comprehensive enterprise risk management strategies will be in a much better position to prevent, minimize or recover from losses in shareholder value.

It’s time for committee members to remove their individual hats, whether financial, marketing, management, or other, and consider different ways of thinking.

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Forget-Me-Knot
November 19, 2021

Resilience. Fortitude. Community. Perseverance.  After Hurricane Sandy tore through the northeast, leaving unfathomable destruction in its wake, these are the words that repeatedly come to my mind. It has been over two weeks since this horrific storm and still the amount of damage is impossible to comprehend. Thousands are yet without the basics- electricity, food and water- and worse, many have lost loved ones.

The concept of community and perseverance continues to strike me as I watch our country put aside differences and come together to support relief efforts from small and local to national endeavors.  It’s difficult times like these when the resilience, fortitude and true sense of kinship within our country shines brightest. Rebuilding efforts will unquestionably be massive. But that won’t deter the people of our communities. It will only bring us closer and make us stronger.

Many members of our ParenteBeard family live and work in some of the areas hardest hit, so we were eager to join in to help our coworkers as well as all those affected in the region we call home. Last Tuesday, we began our Forget-Me-Knot fundraising campaign. Our firm will match the amount raised by our team members and send the donation to the American Red Cross.

As the doors swung open to our offices Tuesday morning, all ParenteBeard team members had a string knotted around their fingers as a reminder to make a contribution to the relief effort. Hence the name “Forget-Me-Knot” was born. We are pleased to say we were able to donate more than $21,000 to the American Red Cross after the four day campaign thanks to our caring team members.

As time passes, we must remember the tremendous impact of Hurricane Sandy and make a commitment to continue supporting the rebuilding of our communities. Our willingness to contribute and help each other has no end date. That’s the ParenteBeard way.

I continue to feel inspired by the outpouring of support from people near and far.  Our thoughts and prayers go out to every person  who was affected and continues to struggle in the aftermath.  The success of the Forget-Me-Knot initiative and the storm itself are emotional experiences we will not soon forget.

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When in China…
November 5, 2021

As I was heading from the hotel to the airport for my return flight home, I found myself mulling over several observations from my enlightening trip to China. Throughout my time in Beijing, there were many instances where I felt as if I could have been in the States. This despite the apparent boom in construction as evidenced by cranes everywhere, the food trucks selling exotic fare such as scorpion and centipede, and the always gridlocked highways with drivers treating the shoulders as a passing lane. Even while separated by more then 7,000 miles, the morning papers’ content was centered on the same issues I would have been reading in the WSJ back home. Everywhere I looked, all I saw were heads buried in iPhones and Samsungs. At times I forgot I was even in China.

But despite how connected our countries are and the increasing appetite for a western style of living , it is still a country with a very special character of its own. Nowhere was this more apparent than in conducting business. No matter how similar our countries appear to be, business in China is deeply rooted in tradition and habits. In fact, I’ve noticed that the biggest difference in our business cultures lies in our respective decision-making processes.

In the U.S., we often approach business decisions very objectively and analytically. It’s the “show me the numbers and I’ll make the decision” mentality. In China, businessmen tend to look at the bigger picture first and use more subjective observations, such as the relationship dynamic, to make the decision. Neither way is correct nor incorrect – they’re just different styles. But if you want to successfully do business with a Chinese partner, you need to understand and appreciate their business etiquette.

So as our cultures converge and at times seem indistinguishable, it’s important to understand that we still have fundamental differences in how we approach business. Traveling provides us all with an opportunity to learn and grow both personally and professionally. It helps open our minds to new approaches to work and life. Among the cultural differences I’ve yet to fully adjust to, though, is China’s Airport Customs and Security, which involved much stricter measures when exiting their country than ours. I never thought I would actually long for the process the TSA has in place in the U.S. Once again, it’s an example of how countries can have different approaches to reach the same end goal.

But I’m happy to be back home with my family now, even with the renewed jetlag I had just overcome.

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Not Lost in Translation
October 29, 2021

After a day of meetings and recovering from the still-lingering jet lag, our tax practice leader Joe O’Neill and I had the privilege of attending a private dinner at an exquisite Chinese restaurant. The event was hosted by a senior executive of a financial services firm who happens to be a close personal friend of Mr. Chen Yonghong, the managing partner of Baker Tilly China. Beyond being good company, Mr. Chen was able to help us key in on details that can often get lost in translation through the cultural and language barriers of international business.

No matter how many times I’ve done it, communicating through a translator is a challenging task. But I’ve found it forces you to be even more focused on the conversation. You notice things like body language, tone of voice and facial expressions. You might take these for granted if you’re both speaking the same language. If you think about it, sometimes the non-verbal cues can tell you a lot more about how a person is feeling than the words that they’re saying anyway.

At the event we had two translators who facilitated our conversations. Over a traditional 10-course Chinese meal we discussed our families, Chinese and U.S. politics, the upcoming U.S. Presidential election and the changing landscape of Chinese leadership, among other topics. Talking business, though, was almost nonexistent during dinner.

By the end of the evening after many toasts to friendship, family and good health, we realized how we can all benefit from doing business together. I can safely say that even though we didn’t speak the same language, nothing was lost in translation.

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Reflections from the Road: China
October 22, 2021

I’m in Beijing, China, attending the Baker Tilly International world conference.  It’s my second trip here and I really enjoy the country and its people.

The purpose of my trip is to participate in Baker Tilly international’s governance and operational meetings as both an international board member and the chairman of the North American region.  Baker Tilly International is a worldwide network of independent accounting and business advisory firms in 125 countries, with more than 24,000 professionals and a combined revenue of over $3 billion.  ParenteBeard now has a global reach thanks to our affiliation with the network and I travel internationally several times a year as a chairman.

This trip, I will be attending a variety of presentations by distinguished individuals from across the globe.  I’ll also network with our global member firms that refer business and provide service to our clients who have overseas operations.  I will attend a Baker Tilly China client function to promote the network and the advantages of doing business in the U.S. through Baker Tilly International’s network.  My plans also include a dinner with the deputy general manager of one of the largest international financial institutions.

People are always interested in the details of my time abroad.  My next few posts will share some of my experiences and observations.

Here’s a snapshot of the first part of my trip:

  • Left home at 7:00 am to drive to Newark
  • Departed U.S. at 11:55 am
  • Flew 7,280 miles north through Canada over the North Pole to Beijing
  • Estimated travel time:  13 hours
  • Read the current edition of Wine Spectator, started reading a book written by my friend Donald Bliss entitled “Mark Twain’s Tale of Today” and read various documents and position papers
  • Slept for two hours
  • Listened to jazz and classical music
  • Endured a very turbulent flight for the first 2,000 miles
  • Landed on time; cleared customs easily
  • Arrived Wednesday afternoon (time difference is 12 hours ahead and I left Tuesday morning)

Had dinner with a friend from Brazil. Conversation centered on the Latin American economy and the economic challenges facing the region as a result of what’s happening globally.  For example, in Sao Paulo, apartments were very scarce 24 months ago. Now, apartments are widely available in that city. My question: where did everybody go?

A few other observations on the evening:

  • About the meal:  enjoyed phenomenal Australian beef; there were few American wines; there were limited, but very expensive, brands of French wines; Australian and Latin American wines were reasonably priced.
  • An amazing number of Chinese and Asians smoke – everywhere.
  • I was intrigued by our Chinese bartender Nigel.  When I asked him about his name, he shared a story that he was told as a boy to adopt an English name.

I’m contemplating all of the similarities and differences between China and the U.S. when my phone rings towards the end of the night.

It’s Comcast reminding me that CNN is moving to another channel in their lineup.

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All Hands on Deck
October 15, 2022

We recently held our all team meetings and it got me thinking about the larger concept.  We are lucky at ParenteBeard in that most of our team members actually look forward to these meetings.  But I do understand the challenges companies and leaders face when planning these events.

If the only real goal of an all team meeting is to get everyone in the same room, it can be difficult to produce a meaningful outcome. However, when all hands meetings are approached correctly, they can be a very powerful tool for promoting a company’s vision. Understanding the purpose and having a well thought out plan are keys to having a successful, meaningful meeting.

Sometimes we can lose sight of the bigger picture. The strategic direction and goal of the company often gets lost in the details of everyday responsibilities. This meeting gives us an opportunity to put our vision back in focus. An organization needs to be aligned throughout all of its units with a singular vision if it wishes to grow.

If each team member leaves the meeting with one thing to remember and take action on, then it is a success. To do this, you must make your message resonate with everyone by explaining what’s in it for each of them. It’s integral that every employee feels as though he or she is part of the firm’s movement towards a singular vision. By definition, the all team meetings should be about all of those in attendance. It’s important to make the connection to how each employee’s day-to-day duties contribute to the overall success of the company.

Lastly, it provides a forum for us to connect with one another. These meetings are not simply a chance for the CEO to stand in the spotlight. It’s important for employees from throughout the organization to participate in order to truly build unity. These meetings are a tremendous opportunity for all business segments to refocus on the vision and move forward together as one company, one community. For some companies, all team meetings may have developed an undesirable reputation, but when approached with the right mindset and plan they are extremely effective in moving a company forward.

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A Win-Win: Growing with Diversity
October 8, 2022

The American Institute of CPAs (AICPA) recently announced the formation of their National Commission on Diversity, a group aiming to increase diversity in the accounting profession.

In our firm, we see diversity as an integral part of our culture and vital to our continued growth. We recently formed our own Diversity Council to drive greater awareness and focus on its importance. We are embracing culturally diverse opportunities and look forward to the benefits that accompany them. In an increasingly complex business environment, it’s more important than ever to take advantage of our differences – race, gender, faith, perspective and more – to help us meet the ever-changing needs of the clients and communities we serve.

For your company or organization, diversity has countless advantages. Beyond the many benefits that come from utilizing the intangible skills of a diverse workforce, it will allow you to tap into an extensive range of cultural networks, filled with potential clients and partners. You can provide even higher levels of client service by having access to a broad range of viewpoints. And reflecting the global marketplace is a key driver to expanding. In the future, I believe performance will hinge on how well we advocate diversity and inclusion.

In short, embracing diversity has exponential benefits for individuals, communities, companies and our society.

It’s also the right thing to do.

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Thanks for stopping by
September 11, 2022

I’d like to welcome you to my blog.

It’s exciting for me to try something entirely new. (And a bit scary.)

I plan to write about what’s on my mind – business trends, current events, travel or any topic I have an insight into or opinion on.

My goal is for my reflections to go “beyond the numbers” of the CPA profession. I hope to share things I’ve learned and life experiences I’m still having along the way.

But blogs are not just for putting stuff out there. I hope to foster an environment that encourages open discussion and feedback from all of you.

Bear with me while I’m still getting the hang of this and send any initial thoughts or suggestions to BobsBlog@ParenteBeard.com.

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