The Essential CFO

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.

Autorentext

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.

Zusammenfassung
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.

Inhalt

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...