Jay Sachetti joined Jeff O’Brien, partner at Husch Blackwell and Dyanne Ross-Hanson, president of Exit Planning Strategies talked about the market for mergers and acquisitions, exit planning opportunities for companies that don’t end up for sale and how companies can maximize their eventual sale price during an early October panel at the first Upsize on Tap event at Summit Brewing Co. in St. Paul.
When the state Legislature passed a law requiring employers to provide paid leave and safe time for employees, Justin Bieganek started hearing differing details from friends, colleagues and peers.
To many chief financial officers of publicly held companies, the Sarbanes-Oxley Act of 2002 is a hassle. The stricter financial reporting regulations could double the cost of being a publicly traded firm to $2.5 million a year, some say.
But to Ashish Gadnis, the new rules are an opportunity for companies to improve their operational efficiencies. He’s president of Fourth Generation Inc. in St. Paul, which offers a service to help small companies in particular to comply with new information technology controls.
“A lot of people just look at the negative side,” Gadnis says. “When I met with CEOs and COOs, I said, you need to create the financial discipline in your company.”
Fourth Generation has seen increased interest since January in Route 6, its combo process and system that “looks under the covers in terms of your operating systems,” Gadnis says. “Within four to six weeks, we’re able to map out the systems that support the costs of running a business.” It costs $50,000 and up.
Section 404 is the important part of Sarbanes-Oxley this year, with June 15 and Dec. 31 deadlines looming. “The SEC has laid out that as a company you need to look into three things: what are the current operating processes that enable financial reporting; what are the risks associated with those processes; and how are you mitigating those risks,” Gadnis explains, referring to the Securities & Exchange Commission.
Last fall he and others at the company called the CFOs of 153 public companies in Minnesota. “Eighty percent of the people said, yes we’re doing something, but they thought it was a pain in the ass, which is not the way to look at it.
“When I talk to companies and they say, ‘Here’s another piece of legislation to regulate the way we breathe,’ why not say, ‘you’ve always wanted to be operationally efficient.’ Profit margins have gone way down, so you need operational efficiency,” he says.
Ashish Gadnis, Fourth Generation Inc.: 651.767.8450; ag*****@*******en.com; www.fourthgen.com
