Page 225 - Accounting Best Practices

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Finance Best Practices
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11–9 USE WEB BROADCASTING FOR PUBLIC REPORTING
Publicly held companies are supposed to issue financial information to the public
through the quarterly reporting process. However, this has, until recently, only
required the issuance of standard quarterly financial statements and an annual
meeting. Any further information was frequently limited to meetings with
selected Wall Street analysts. This reduced level of information dispersal has now
come to an end, thanks to the Securities and Exchange Commission’s new Regu-
lation FD (for Fair Disclosure). This new rule requires companies to make a
broad disclosure, through a press release at a minimum, whenever company offi-
cers release important information about the company to any outsiders. Though
the traditional press release is sufficient for compliance with the regulation, it is
also possible to generate much broader distribution of this information through
the use of a webcast.
A webcast is simply a conference call that is posted on the Internet for gen-
eral access. It allows virtually anyone to listen in on the discussions between
company managers (usually the chief executive officer or chief financial officer)
and outside analysts regarding company-specific information. This is a very inex-
pensive approach to disseminating information. It also keeps analysts from get-
ting access to tidbits of company information that they can in turn send out to
their clients as hot tips (especially since their clients may have been listening to
the same webcast), unless the webcasts are issued on a time-delayed basis.
A provider of webcasts is Corporate Communications Broadcast Network,
whose Web site can be reached at www.ccbn.com. This company facilitates webcasts
by setting up basic audio webcasts for quarterly conference calls; it also offers an
enhanced audio webcast that is set up through a separate Web page that looks like
a page from a company’s regular Web site but that has special features, such as a
time delay on the broadcast and access to detailed audience reporting, in order to
find out who has monitored the webcast. The company also offers an advanced
feature called “Virtual Presentations” that synchronizes audio presentations with
PowerPoint slides, using its TalkPoint TM technology. This option can be used for
other purposes, such as training presentations, product demonstrations, and
advertising.
Cost: Installation time:

11–10 AUTOMATE OPTION TRACKING

When a large number of employees have company options, either the finance or
human resources department will be the target of ongoing questions about the vest-
ing, valuation, and tax implications of these options. Because the tax laws are so
complex in this area, employees keep coming back with follow-up clarification
questions, as well as to run “what if” scenarios on what they should do under various