The Essential Controller An Introduction to What Every Financial Manager Must Know

by Bragg, Steven M.

• ISBN13: 9781118169971
• ISBN10: 1118169972
• Edition: 2nd
• Format: Paperback
• Copyright: 2012-04-10
• Publisher: Wiley

Summary

This book is designed to give the new controller a firm foundation in the concepts of managing the accounting department, locating GAAP information, analyzing and knowing what to do with key accounting information, and setting up controls systems that reduce a company's risk of loss. These core areas are essentials to a controller's success. New to this edition will be a discussion of finance strategy; introduction of the accounting standards codification, update of the taxation strategy; and a new controller checklist will be added as an appendix.

Author Biography

Steven M. Bragg, CPA, has been the chief financial officer or controller of four companies, as well as a consulting manager at Ernst Young and auditor at Deloitte. He is the author of over thirty books primarily targeted toward controllers and their needs. Bragg received a master's degree in finance from Bentley College, an MBA from Babson College, and a bachelor's degree in economics from the University of Maine.

Table of Contents

Preface	p. ix
Accounting in the Corporation	p. 1
Importance of This Chapter	p. 1
Tasks of the Accounting Function	p. 2
Role of the Accounting Function	p. 5
Role of the Controller	p. 6
Impact of Ethics on the Accounting Role	p. 8
Evolving Role of Accounting	p. 12
Controller's Responsibilities	p. 13
Importance of This Chapter	p. 13
Variations on the Title	p. 14
Planning Function	p. 14
Control Function	p. 16
Reporting Function	p. 17
Accounting Function	p. 17
Additional Controller Functions in Smaller Companies	p. 18
Controller's Job Description	p. 22
Relationship of the Controller to the Chief Financial Officer	p. 24
Future Changes in the Controller's Origins and Responsibilities	p. 26
Managing Rapid Growth	p. 28
Chief Financial Officer: From Controller to Facilitator of Change	p. 31
Importance of This Chapter	p. 31
Understanding What Chief Executive Officers Want	p. 32
Task of the CFO	p. 32
Develop and Communicate a Compelling Finance Agenda	p. 33
Build a Commitment to Change within Finance	p. 36
Change Executive Management Practices	p. 40
Enlist the Support of the Chief Executive Officer	p. 42
Mobilize the Organization	p. 44
Institutionalize Continuous Improvement	p. 46
Operational Accounting	p. 49
Importance of This Chapter	p. 49
Create Departmental Job Descriptions	p. 50
Create a Departmental Training Program	p. 52
Clear Out Excess Documentation	p. 55
Streamline the Accounting Workflow	p. 56
Document All Major Processes	p. 58
Correct the Underlying Causes of Errors	p. 59
Use Best Practices	p. 62
Outsource Selected Accounting Functions	p. 64
Cost Accounting and Costing Systems	p. 71
Importance of This Chapter	p. 71
Purpose of Cost Accounting Information	p. 72
Input: Data Collection Systems	p. 73
Processing: Data Summarization Systems	p. 77
Processing: Job Costing	p. 79
Processing: Process Costing	p. 87
Processing: Standard Costing	p. 90
Processing: Direct Costing	p. 93
Processing: Throughput Costing	p. 96
Processing: Activity-based costing	p. 101
Processing: Target Costing	p. 103
Outputs: Cost Variances	p. 107
Ratio and Trend Analysis	p. 113
Importance of This Chapter	p. 113
How to Use Ratios and Trends	p. 114
A Caveat	p. 115
Measures for Profitability	p. 118
Measures for the Balance Sheet	p. 122
Measures for Growth	p. 128
Measures for Cash Flow	p. 129
Measures for Nonfinancial Performance	p. 132
Interrelationship of Ratios	p. 152
Setting Up a System of Ratios and Trend Analyses	p. 154
Internal Control Systems	p. 157
Importance of This Chapter	p. 157
Objectives	p. 158
Responsibility for Internal Controls	p. 159
Examples of Internal Controls	p. 161
When to Eliminate Controls	p. 164
Types of Fraud	p. 167
Preventing Fraud	p. 169
How to Deal with a Fraud Situation	p. 174
Foreign Corrupt Practices Act	p. 176
The Fast Close	p. 179
Importance of This Chapter	p. 179
Different Types of Fast Close	p. 180
How to Achieve a Fast Close	p. 181
Enhanced Closing Process	p. 196
Internal Audit Function	p. 197
Importance of This Chapter	p. 197
Reporting Relationships	p. 198
Composition of the Audit Committee	p. 199
Role of the Audit Committee	p. 201
Internal Audit Objectives	p. 203
Internal Audit Activities	p. 206
Managing the Internal Audit Function	p. 209
Recruiting, Training, and Supervision	p. 215
Importance of This Chapter	p. 215
Recruiting Sources	p. 216
Factors to Consider When Recruiting	p. 219
Factors to Consider When Promoting	p. 221
Importance of Reduced Turnover	p. 223
Importance of Developing Career Plans for Employees	p. 228
Importance of Communications with Employees	p. 231
How to Motivate Employees	p. 233
Controller's Role in Investor Relations	p. 235
Importance of This Chapter	p. 235
Objectives of the Investor Relations Function	p. 236
Evolving Nature of the Function	p. 237
Communication Vehicles for Investor Relations	p. 238
Investor Relations Message Recipients	p. 239
Information Needs of the Financial Analyst	p. 240
Information Needs of Other Groups	p. 243
Disclosure Policy	p. 243
Organization Structure for Investor Relations	p. 245
Role of the Controller and Other Principals	p. 246
Some Suggested Financial Market Objectives	p. 250
Some Suggested Methods	p. 251
Taxation Strategy	p. 253
Importance of This Chapter	p. 253
Accumulated Earnings Tax	p. 255
Cash Method of Accounting	p. 256
Inventory Valuation	p. 257
Mergers and Acquisitions	p. 258
Net Operating Loss Carryforwards	p. 259
Nexus	p. 261
Project Costing	p. 262
Property Taxes	p. 262
S Corporation	p. 263
Sales and Use Taxes	p. 264
Transfer Pricing	p. 266
Unemployment Taxes	p. 269
About the Author	p. 271
Index	p. 273
Table of Contents provided by Ingram. All Rights Reserved.