The Essential CFO

1. Auflage 2012
ISBN: 978-1-118-17304-6
Verlag: Wiley

Buch, Englisch, 350 Seiten, Format (B × H): 154 mm x 237 mm, Gewicht: 466 g

Reihe: Wiley Corporate F&A

Discover the power of the CFO's role in delivering shareholder value

During the past decade, the CFO role has expanded dramatically in its breadth, complexity, and criticality. Filled with proven strategies, best practices, and keen insights, The Essential CFO describes how today's CFOs are responding to their expanded roles within both public and private companies. With straightforward and pragmatic guidance, author Bruce Nolop shows how CFOs are partnering with CEOs to deliver shareholder value by articulating a strategic plan, determining capital allocations, managing the capital structure, driving financial performance, and implementing strategic transactions.

Covers how CFOs are establishing robust accounting and risk management processes and effectively communicating with both external and internal constituencies
Looks at the role of the CFO in transforming financial organizations to drive effectiveness and efficiencies
Examines how CFOs can develop talent with the experience, expertise, and leadership skills to meet the challenges of the future

Written from a balanced, top-down perspective of the modern CFO, The Essential CFO provides you with practical prescriptions for executing impactful corporate finance strategies.

Autoren/Hrsg.

Nolop, Bruce P

Fachgebiete

• Wirtschaftswissenschaften Finanzsektor & Finanzdienstleistungen Unternehmensfinanzierung
• Wirtschaftswissenschaften Betriebswirtschaft Unternehmensfinanzen Finanzierung, Investition, Leasing

Inhaltsverzeichnis

Introduction xv

PART I: STRATEGY

Chapter 1: Articulating a Strategic Plan 3

Business Objectives 4

Strategic Themes 5

Long-Term Financial Model 7

Total Shareholder Return 10

Capital Allocation Strategies 14

Acquisition Strategies 15

Target Shareholders 17

Elevator Pitch 20

Plan Revisions 21

Chapter 2: Communicating and Achieving Alignment 23

Consistency and Transparency 24

Incentive Compensation Programs 25

Investor Alignment 28

Analyst Relations 29

Investor Presentations 31

Company Website 35

Social Media 36

Media Relations 37

Potential Media Pitfalls 38

Coordinating Communications 39

Interview Formats 39

Media Training 40

Note 42

Chapter 3: Assessing Enterprise Risks 43

Enterprise Risk Management 43

Implementation of ERM 44

Risk Identification 45

Risk Quantification 46

Major Exposures 47

Mitigation Strategies 50

Rewarded versus Unrewarded Risks 51

Governance of ERM 52

CFO's Role in ERM 54

PART II: CAPITAL ALLOCATIONS

Chapter 4: Estimating the Cost of Capital 59

WACC Formula 59

Hurdle Rates 63

Risk Premiums 63

Acquisition Cost of Capital 65

Chapter 5: Prioritizing Capital Investments 67

Cash Flow Projections 67

Investment Budget 68

Evaluating Projects 71

Categorizing Projects 74

Monitoring Projects 75

Pension Fund Contributions 77

Chapter 6: Considering Dividends and Repurchases 79

Dividend Policy Alternatives 80

Dividend Policy Considerations 82

Special Dividends 85

Dividend Declarations 85

Repurchase Considerations 86

Open Market Programs 90

Tender Offers 92

Retaining Strategic Cash 92

Cash Investment Policies 95

PART III: MERGERS AND ACQUISITIONS

Chapter 7: Identifying Acquisition Candidates 99

Rationale for Acquisitions 99

Adjacent Spaces 100

Portfolio Approach 101

Business Sponsor 101

Patience and Flexibility 102

Strategic Purpose 102

Types of Acquisitions 103

Note 107

Chapter 8: Evaluating Acquisition Candidates 109

Valuation Methodologies 109

Standalone and Synergy Values 112

Pro Forma Analyses 113

Acquirer's Stock Valuation 116

Risk Considerations 116

Chapter 9: Executing a Merger or Acquisition 119

Due Diligence 119

Business Plan 123

Financial Projections 124

Financing Plan 126

Price Negotiations 128

Contract Terms 129

Acquisition Integration 132

Note 134

Chapter 10: Executing Divestitures and Spinoffs 135

Divestiture Evaluations 135

Hiring Investment Bankers 136

Auction or Negotiated 137

Stock or Assets 139

Financing Conditions 139

Management Participation 140

Tax-Free Spinoffs 141

Split-Ups 142

Equity Carve-Outs 143

Chapter 11: Responding to Takeover Offers 145

Governance Policies 145

Reviewing an Offer 146

Conducting a Sale Process 148

Activist Shareholders 149

Going Private Transactions 149

PART IV: FUNDING

Chapter 12: Establishing Capital Structure Objectives 153

Leverage Targets 153

Leverage Criteria 155

Rating Agencies 157

Ratings Categories 158

Rating Agency Dialogues 160

Ratings Criteria 161

Informing Investors 162

Note 163

Chapter 13: Developing Financing Strategies 165

Financing Principles 165

Debt Financing 167

Equity Financing 171

Off Balance Sheet Financing 174

Debt Covenants 177

Debt Refinancings 179

Debt for Equity Swaps 180

Bankruptcy 182

Chapter 14: Ensuring Short-Term Liquidity 185

Bank Lines 185

Cash Planning 187

Contingency Planning 187

Liquidity Ratios 189

Working Capital Strategies 189

Trapped Cash 191

PART VI: ACCOUNTING AND CONTROLS

Chapter 15: Obtaining Long-Term Financing 193

Venture Capital 193

Private Equity 194

Initial Public Offering 195

Subsequent Equity Offerings 198

Term Loans 200

Syndicated Bank Loans 200

Investment Grade Securities 200

High Yield Securities 201

Strategic Alliances 2

Über Autor(innen)

Nolop, Bruce P
Bruce Nolop retired in 2011 after a 35-year career as an investment banker and corporate executive, including more than a decade as chief financial officer of Pitney Bowes and E*TRADE Financial. He has been a board member of Marsh & McLennan since January 2008 and currently serves on the audit, compliance and risk, finance, and corporate responsibility committees.