Running, Managing, And Operating A Corporation

1. Setting Up, Managing, and Operating a Corporation 1

2. Table of ContentsWhy a Corporation- Slide 4

3. Sole Proprietorship- Slides 5-7

4. Partnerships- Slides 8-10

5. Franchise- Slides 11-13

6. Corporations Slides 14-22

7. Shareholders and Stockholders- Slides 23-25

8. How to Set Up a Corporation – Slides 26-27

9. Articles of Incorporation – Slides 28-30

10. Bylaws- Slide 31

11. Company Handbooks- Slides 32

12. Groups & Teams- Slides 33-44

13. Outsourcing & Backsourcing- Slide 45

14. CEO- Slides 46-54

15. Agent of Service- Slides 55-57

16. Board of Directors- Slides 58-60

17. Secretary- Slides 61-70

18. Secretaries- Slides 76-77

19. Accounting & Financing- Slides 78-131

20. Human Resources- Slides 132-143

21. Information Technology- Slides 144-159

22. ERP- Slides 160-171

23. Operations & Logistics- Slides 172-180

24. Sales & Marketing- Slides 181-191

25. Legal Department- Slide 192

26. Closing- 193

27. References - 1942

28. Table of Contents 3

29. Why a Corporation? Business owners should incorporate for many reasons demonstrated throughout this presentation.

30. The main reason for incorporation of the production company is limited liability.

31. No business is worth losing everything you own

32. Incorporation will lead to a more successful company

33. Small business owners can incorporate as well as other business owners4

34. Sole Proprietorship A sole proprietorship is a business that is owned and usually managed by one person

35. Examples would be: a word processing service out of your home- a website- a restaurant- your own car repair center

36. Usually fits the needs of the community

37. 72% of businesses in America are sole proprietorships 5

38. Advantages of a Sole ProprietorshipEase of starting and ending the business

39. Being your own boss

40. Pride of ownership

41. Leaving a legacy

42. Retention of company profit

43. No special taxes6

44. Disadvantages of a Sole ProprietorshipUnlimited Liability- the risk of personal losses

45. Limited financial resources (in most cases but not all)

46. Management difficulties

47. Overwhelming time commitment

48. Few fringe benefits

49. Limited growth

50. Limited life span7

51. Partnerships A partnership is a legal form of business with two or more owners

52. Two or more people legally agree to become co owners of a business

53. Make up 8 % of businesses in America8

54. Advantages of PartnershipsEasier to own and manage

55. More financial resources

56. Share management and pooled/complementary skills and knowledge

57. Longer survival

58. No special taxes9

59. Disadvantages of a PartnershipUnlimited liability

60. Division of profits

61. Disagreements among partners

62. Difficult to terminate 10

63. Franchises A franchise is an arrangement whereby someone with a good idea for a business sells the rights to use the business name and sell a product of service to others in a given territory

64. A franchise can be a sole proprietorship, a partnership, or a corporation.

65. Examples of a franchise: McDonald’s, 7 Eleven, Holiday Inn, etc… 11

66. Advantages of a FranchiseManagement and marketing assistance

67. Personal Ownership

68. Nationally recognized name

69. Financial advice and assistance

70. Lower failure rate12

71. Disadvantages of a FranchiseLarge start up cost

72. Shared profit

73. Management regulations

74. Coattail effects

75. Restrictions on selling

76. Fraudulent franchisors13

77. CorporationsA corporation is a state chartered legal entity with authority to act and have liability separate from its owners

78. Corporations can fit into more than one category

79. Two most common types of corporations are S corporations and C corporations14

80. S Corporation or C CorporationC Corporation – a state chartered legal entity with authority to act and have the liability separate from its owners

81. S Corporation- a unique government creation that looks like a corporation but is taxed like sole proprietorships and partnerships. 15

82. Types of Corporations Alien corporation- does business in the United States but is chartered (incorporated) in another country

83. Domestic corporation- does business in the state in which it’s chartered(incorporated)

84. Foreign corporation- does business in one state but is chartered in another. About 1/3 of all corporations are chartered in Delaware because of its relatively attractive rules for incorporation. A foreign corporation must register in states where it operates.16

85. Types of Corporations Closed (private) corporation- the stock is held by a few people and isn’t available to the general public

86. An open (public) corporation- sells stock to the general public. General Motors and Exxon/Mobile are examples of public corporations

87. Quasi Public corporation- chartered by the government as an approved monopoly to perform services to the general public. Public utilities are examples of quasi public corporations17

88. Types of Corporations Professional corporation- one whose owners offer professional services (doctors, lawyers, etc.) Shares in professional corporations aren’t publicly traded.

89. Nonprofit corporation- one that does not seek personal profit for its owners

90. Multinational corporation- a firm that operates in several countries18

91. Advantages of CorporationsLimited liability- hugest advantage

92. More money for investment

93. Size

94. Perpetual life

95. Ease of ownership change

96. Ease of drawing talented employees

97. Separation of ownership from management19

98. Disadvantages of a CorporationExtensive paperwork

99. Double taxation

100. Two tax returns

101. Size

102. Difficulty of termination

103. Possible conflict with stockholders and board of directors

104. Initial cost 20

105. Stock CorporationsIssues and sells the stock to individuals to raise money for business start up or growth

106. Stock can be privately held or publicly held

107. Privately held stock is usually only offered to a few individuals

108. Publicly held companies can publicly trade or sell to many or a few individuals.

109. Can be closely held or widely traded

110. Stock decisions must be included on the Articles of Incorporation when applying for corporate status.21

111. Non Stock Corporations A corporation that does not issue shares of stock

112. Non profit corporations are non stock corporations

113. A for profit corporation may be a non stock corporation for several reasons: The corporation may be closely held or owned by a few individuals who have no interest in selling sharesThe corporation may be formed for a single short term purposeThe corporation may be set up as a non profit with members instead of shareholders22

114. Shareholders/Stockholders Any person, company, or other institution that owns at least one share in a company. Referred to as shareholders or stockholders

115. Shareholders are the owners of a company. They have the potential to profit if the company does well, but that comes with the potential to lose if the company does poorly(they won’t lose anything more than the investment in stocks- they can’t lose any personal belongings).

116. Shareholders can not lose anything other than their investment in the company. 23

117. Stockholders or Shareholders PrivledgesStockholders are granted special privileges depending on the class of stock. These rights may include:

118. The right to vote on matters such as elections to the board of directors. Usually, stockholders have one vote per share owned, but sometimes this is not the case

119. The right to propose shareholder resolutions

120. The right to share in distributions of the company’s income

121. The right to purchase new shares issued by the company

122. The right to a company’s assets during a liquidation of the company.24

123. Shareholders & StockholdersPlay an important role in raising capital for organizations

124. Deciding between privately held or public stockholders is up to the owner

125. Companies typically provide all the necessary proofs to shareholders to show that they are investing at a right place25

126. How to Set up a Corporation Owners can incorporate in any state but Delaware is the easiest place to incorporate.

127. Register as a foreign corporation in your actual home state after incorporating in Delaware if that is where you choose to register

128. Consult an attorney specializing in this area 26

129. Six Steps to Getting StartedCreate the corporation’s Articles of IncorporationDetermine which type of corporation you want to create.Consider registering your corporation in DelawareFile those Articles with the Secretary of State of the state in which you choose to be headquarteredSubmit a check with the Articles of Incorporation. Processing fees for this service vary by stateRegister as a foreign corporation if you will be doing business in any states not designated as your home state.27

130. Articles of Incorporation Articles of Incorporation are a document filed with a U.S. state by a corporation’s founders, describing the purpose, place of business, and other details of a corporation– also called a charter. 28

131. Articles of Incorporation Usually IncludeThe corporations name

132. The names of the people who incorporate it

133. Its purposes

134. Its duration (usually perpetual)

135. The number of shares that can be issued, their voting rights, and any other rights the shareholders have

136. The corporation’s minimum capital

137. The address of the corporation29

138. Articles of Incorporation Usually Include The name and address of the person responsible for the corporation’s legal service (The Agent of Service)

139. The names and addresses of the first directors

140. Any other public information the incorporators wish to include30

141. Bylaws How, when, and where shareholders’ and director’s meetings are held, and how long directors are to serve

142. Director’s authority

143. Duties and responsibilities of officers, and the length of their service

144. How stock is issued (private of public)

145. Other matters, including employment contracts31

146. Company HandbooksCompany Handbook

147. Policies, Practices, and Procedures for each employee and each department

148. Mission Statement

149. Ethical Guidelines32

150. Groups & Teams in an Organization Groups: Two or more individuals, interacting and interdependent, who have come together to achieve particular goals

151. Teams: Individuals generating positive synergy through coordinated efforts. Several individuals whose individual efforts result in a level of performance that is greater than the sum of those individual inputs.33

152. Groups Groups can be formal or informal

153. Formal group: Groups defined by the organization’s structure, with designated work assignments establishing tasks. The behaviors are stipulated by and directed toward organizational goals.

154. Informal group: Alliances that are neither formally structured nor organizationally determined. 34

155. Five Stages in Groups FormingStormingNormingPerformingAdjourning35

156. Advantages of Groups Numerous resources

157. Smooth processes

158. High performance

159. Successful results

160. Satisfied employees 36

161. Teams Work Teams: generate positive synergy through coordinated effort and individual efforts of members result in a level of performance that is greater than the sum of those individual inputs.

162. Work Teams provide services, negotiate deals, coordinate projects, offer advice and make decisions37

163. Types of Teams Problem Solving Teams

164. Self Managed Work Teams

165. Cross Functional Teams

166. Virtual Teams38

167. Problem Solving Teams Groups of 5 to 12 employees from the same department who meet for a few hours a week to discuss ways of improving quality, efficiency, and work environment

168. Share ideas or offer suggestions on which work processes and methods can be improved

169. Rarely given authority to unilaterally implement any of their suggested actions39

170. Self Managed TeamsGroups of 10-15 people who take on responsibilities of their former supervisors.

171. Tasks include: planning & scheduling of work- assigning tasks to members- collective control over the pace of work- making operating decisions- taking actions on problems- working with suppliers and customers

172. Select their own members

173. Members evaluate each other’s performance40

174. Cross Functional TeamsEmployees from about the same hierarchical level but different work areas coming together to accomplish a task

175. Examples would be: a task force- committees composed of members from across departmental lines- the large task force IBM created made up of employees from across departments in the company to develop its highly successful System 360

176. Allow exchanging of information- developing new ideas- solving problems- and coordinating complex projects41

177. Cross Functional TeamsNo picnic to manage

178. Early stages of development are time consuming

179. Members must learn to work with diverse and complex individuals

180. Building trust is not easy42

181. Virtual Teams Teams that use computer technology to tie together physically dispersed members in order to achieve a common goal.

182. Collaborate online using communication links wide area networks- video conferencing- or emailing whether a room apart or continents apart

183. Do everything other teams do such as: share information- make decisions- complete tasks- include members from within or outside of the organization43

184. Virtual Teams Convene for a few days or months to solve problems

185. Three factors differentiating virtual teams from face to face teams are:The absence of paraverbal and nonverbal cuesLimited social contextAbility to overcome time and space constraints44

186. Outsourcing and BacksourcingOutsourcing and Backsourcing are becoming the norm in today’s companies.

187. Outsourcing- the subcontracting a process, such as product design or manufacturing, to a third party company- the transfer of a business function to an external service provider- contracting work to an outside supplier

188. Backsourcing- the bringing of services back into the organization after they have been outsourced. 45

189. Chief Executive Officer (CEO)Responsible for operations of the firm

190. Highest ranking officer in the organization

191. Reports to the board of directors

192. Responsible for everything

193. Delegates responsibilities

194. Sets the overall strategy for the company

195. Responsible for management46

196. Chief Executive Officer (CEO)The officer who has ultimate management responsibility for the organization

197. Appoints other managers to assist in carrying out the responsibilities of the organization

198. Held accountable for organizational performance47

199. Chief Executive Officer (CEO) Sets the tone for the organization

200. Motivates employees

201. Carries out strategic plans and policies

202. Top CEO’s are paid about 10 ½ million a year

203. Should have education in business-communication and/or law

204. Has total authority to hire & fire with checks and balances or course48

205. Chief Executive Officer (CEO)’s Two Major Functions Direct and execute all activities of the association either directly or through delegated authorityProvide leadership in these and other areas: the creation of strategic, tactical, and financial plans; developing goals and measuring performance to the approved goals; organizational development; liaison to the public, government, affiliated organizations, and other stakeholders; develop member services and member development; the development of the association’s staff49

206. CEO’s Roles and Responsibilities Leader

207. Advises the Board

208. Advocates/promotes organization and stakeholder change related to organization mission

209. Supports motivation of employees in organization products/programs and operations

210. Visionary/Information Bearer

211. Ensures staff and Board have sufficient and up-to-date information

212. Looks to the future for change opportunities

213. Interfaces between Board and employees

214. Interfaces between organization and community

215. Decision Maker

216. Formulates policies and planning recommendations to the Board

217. Decides or guides courses of action in operations by staff50

218. CEO’s Roles and Responsibilities Manager

219. Oversees operations of organization

220. Implements plans

221. Manages human resources of organizations

222. Manages financial and physical resources

223. Board Developer

224. Assists in the selection and evaluation of board members

225. Makes recommendations, supports Board during orientation and self-evaluation 51

226. Duties of the CEO Specific duties of CEO’s vary based on the type of organization but typical functions or job descriptions include:

227. Provide leadership in the development of the association’s statement of vision, mission, and goals, and the corresponding strategies, plans, and budgets to achieve them

228. Ensure the development of priority plans, performance measurements, management controls, and critical success factors

229. Review approved plans and budgets as part of the annual planning and budgeting cycle and present recommendations to the board of directors and/or the appropriate committee

230. Develop and provide appropriate policy recommendations for consideration by the board

231. Ensure that an annual plan and budget are prepared for and presented to the board of directors52

232. Duties of the CEOPropose agendas for the board of directors reflecting issues, opportunities, and priorities

233. Present a written report to all board meetings

234. Develop and maintain an effective staff organization which provides appropriate policy and program recommendations for consideration by the board and its committees, and which delivers services, programs and information beneficial to the members

235. Hire, reward, discipline, terminate, and set the remuneration of, all association employees except for him/herself, in accordance with policy and/or approved budgets

236. Identify, document, and articulate the needs of members to geographic sub-units, committees, and other forums which exist to serve member needs53

237. Duties of the CEO Promote collaboration with and among the association’s geographic sub units to address the needs of members and the mission and goals of the association

238. Maintain the necessary contacts to keep abreast of emerging issues of significance to the association management profession

239. Act as the spokesperson for the association

240. Serve as ambassador for the association to relevant organizations in Canada and internationally

241. Perform such other duties as are prescribed in writing from time to time by the board of directors

242. Typically a non voting director and officer of the association

243. May be a non-voting ex officio member of all committees, councils, task forces, and other member forums appointed or established by, and accountable to, the board of directors

244. Usually the representative of the association as the employer of paid staff and solely responsible for establishing compensation and benefits, and the hiring and release , of the association's employees54

245. Agent of Service and Process Officer appointed by a corporation to receive legal notices or processes on the corporation’s behalf

246. Also called the registered agent

247. Mandatory

248. Must be named in the Articles of Incorporation

249. Can be the owner

250. Can be anyone in the organization who agrees to take on the responsibility55

251. Agent of Service and ProcessReceives legal notices or processes on corporations behalf such as:

252. Summons

253. Complaints

254. Subpoena’s

255. Order to show cause writs

256. Notice to quit premises

257. Other legal documents56

258. Agent of Service and Process Cannot be a party to the action

259. Must deliver the summons of complaint to the defendant

260. Could be an outside law firm

261. Could be someone in the legal department of the corporation57

262. Board of DirectorsBody of elected or appointed members who jointly oversee the activities of a company or organization

263. Must (or usually) consists of an odd number of members

264. Activities and duties are determined by the powers, duties and responsibilities delegated to it or conferred on it by an authority outside itself

265. The responsibilities and/or duties are typically detailed in the organizational bylaws58

266. Board of DirectorsThe bylaws usually specify the number of members on the board- how they are to be chosen- and when they meet

267. The board acts on behalf of the organization’s full assembly

268. The full assembly usually choose the members of the board

269. In a stock corporation the board is elected by the stockholders59

270. Board of Directors Duties Typical duties include:

271. Governing the organization by establishing broad policies and objectives

272. Selecting, appointing, supporting, and reviewing the performance of the CEO (no termination without just cause- post conditions in handbook)

273. Ensuring the availability of adequate financial resources

274. Approving annual budgets

275. Accounting to stakeholders for the organizations performance 60

276. SecretaryThis is not the same as a secretary or administrative assistant

277. Reports to the board of directors

278. Organizations are required by law to maintain certain records for several purposes including:

279. Accurate recollection of decisions

280. Determination of eligibility to vote

281. Continuity of policies and practices

282. Accountability of directors and officers61

283. Responsibilities of the SecretaryThe Secretary is responsible for:

284. Ensuring that accurate and sufficient documentation exists to meet legal requirements

285. Enable authorized persons to determine when, how, and by whom the board’s business was conducted

286. Records minutes of meetings

287. Ensures accuracy and availability

288. Proposes policies and practices62

289. Responsibilities of the SecretaryFulfills any other requirements of a Director and Officer

290. Performs other duties as the need arises as defined in the bylaws

291. Accountable to the Board of Directors63

292. Specific duties of the SecertaryThe specific duties include:

293. Minutes: Accurate minutes of meetings are taken and approved and should include:Date, time, & location of meetingList of those present and absentList of items discussedList of reports presentedText of motions presented and description of their dispositions ‘The secretary signs a copy of the final, approved minutes and ensures that this copy is maintained in corporate records64

294. Specific Duties of the Secretary Custodian of records: Ensures that the records of the organization are maintained as required by law and made available when required by authorized persons. These records include:Founding documents (letter patents, articles of incorporation)Lists of directorsBoard and committee meeting minutes Financial reportsOther official records65

295. Specific duties of the SecretaryMembership Records: The Secretary ensures that official records are maintained of members of the organization of the board. Ensures the records are available when required for reports, elections, referenda, other votes, etc…

296. Bylaws: The Secretary ensures that an up to date copy of the bylaws is available at all meetings66

297. Specific duties of the SecretaryCommunication: The secretary ensures proper notification is given of directors’ and members’ meetings as specified in the bylaws. Manages the general correspondence of the Board of Directors except for such correspondence assigned to others

298. Meetings: The Secretary participates in Board meetings as a voting member. Provides items for the agenda as appropriate67

299. Specific duties of the SecretarySigning Officer: The Secretary may be designated by the Board of Directors and/or bylaws as one of the signing officers for certain documents. Authorized to sign on behalf of the organization:ChecksCorrespondenceApplicationsReportsContractsOther documents68

300. Specific duties of the Secretary Filing of Documents: The Secretary could be the registered agent with respect to the laws of the jurisdiction. Responsible for ensuring that documents necessary to maintain the corporation are filed

301. Note 1:The definition and duties use the word "ensure" to convey the intent that accountability for the specified responsibilities lies with the Secretary but it is not necessarily the Secretary who carries out the activity. Indeed, we expect that many of these responsibilities will be delegated to board committees, staff, or others including experts retained for a specific purpose. The word "ensure" is not intended to imply any additional source of legal duties beyond those that are required by law.69

302. Specific duties of the SecretaryNote 2: Minutes should have enough information to help absent directors and members understand what issues were discussed and what decisions were made. Some lawyers advise that in certain circumstances, minutes should include summary of discussion, rationale for decision, names of those participating in the discussion, and the roll call, noting any declared conflicts of interest. These circumstances: are if the matter is contentious, if board members dissent, if there is any concern about exposure to liability, or if a board member has a conflict of interest.70

303. Secretaries or Administrative AssistantsA person employed to handle correspondence, keep files, and do clerical work for a person or organization

304. Considered entry level positions but play a major role in the daily operations of an organization

305. Besides performing clerical tasks such as typing, photocopying and faxing secretaries conduct research and prepare large scale reports among other things mentioned (next slide)71

306. Duties Duties of a secretary include:

307. Performing clerical duties

308. Schedule meetings

309. Organize paperwork and electronic files

310. Manage projects

311. Creating spreadsheets as necessary

312. Composing correspondence within the office

313. Managing a database and developing presentation or reports using publishing software and digital graphics72

314. Typical FunctionsTypical functions of a secretary are:

315. Open., scan, read and distribute mail

316. Compose official correspondence for supervisors signature, disposes of routine correspondence

317. Screen phone calls; provide information or refer callers to appropriate staff members; answer inquiries

318. Receives visitors; answer inquiries personally or refer to appropriate official (s) 73

319. Typical FunctionsArranges for special conferences and meetings; maintains supervisor’s calendar, advising of commitments; arranges for travel itinerary and accommodations; prepares and submits travel claims and expense account

320. Independently researches, assembles and summarizes material, information and data for administrative board or commission consideration and action; takes and transcribes dictation of confidential, technical and legal material requiring a high degree of accuracy; records and transcribes proceedings of meetings and conferences74

321. Typical FunctionsAppears before legislative committee hearings alone or in the company of a supervisor to present facts relative to agency programs, mission and/or budget; drafts proposed legislation; proposes budget items; confers with administrators on matters of staffing, budget and purchasing and contracts and/or policy75

322. Departments in the CorporationAccounting and Financing

323. Human Resources

324. Information Technology

325. Operations and Logistics

326. Sales and Marketing

327. Legal76

328. Departments in the CorporationOther departments might be necessary but the ones mentioned in this power point will be necessary77

329. Accounting and Financing Accounting is the recording, classifying, summarizing, and interpreting of financial events and transactions to provide management and other interested parties the information they need to make good decisions.

330. Accounting is the measurement and reporting of economic activities of the firmFinancial transactions include:

331. Buying and selling goodsand services

332. Acquiring insurance

333. Paying employees

334. Using supplies78

335. Chief Financial Officer Chief Financial Officer:

336. Head of Accounting Department

337. The executive who is responsible for financial planning and record keeping for a company

338. Delegates responsibilities if necessary

339. Professionally qualified accountant

340. Many CFO’s have a Master of Business Administration but no qualified accountancy qualification such as Certified Public Accountant status

341. Hires the employees in the Accounting Department

342. Answers to the CEO79

343. Possible Employees Necessary in an Accounting DepartmentA/P Clerk

344. Tax Accountant

345. Director of Accounting & Financing/Controller

346. Chief Financial Officer

347. Financial Planner/Budget Specialist

348. Cost Accountant

349. Financial Planning Manager

350. Financial Planner/Budget Specialist

351. Administrative Assistant (a secretary)

352. General Accountant

353. General Accounting Supervisor

354. A/R Clerk

355. Payroll Manager

356. Payroll/Tax Clerk

357. Former IRS employee

358. Auditors

359. Certified management Accountant

360. Private Accountant

361. Public Accountant

362. Certified Public Accountant

363. Certified Internal Auditor

364. A bookkeeper80

365. Accounting and Financing81

366. Accounting and FinancingAccounting serves a few purposes:

367. Help managers evaluate the financial condition and operating performance enabling well informed decisions to me made

368. Report financial information to people outside the firm such as: OwnersCreditorsSuppliersInvestorsThe government82

369. Five working areas of accountingManagerial AccountingFinancial AccountingAuditingTax AccountingGovernment and non profit accounting83

370. Managerial AccountingAccounting used to provide information and analyses to managers within the organization to assist them in decision making

371. Concerned with measuring and reporting costs of:

372. Production

373. Marketing

374. Cost accounting

375. Preparing budgets

376. Checking if units or departments are staying within budgets

377. Designing strategies to minimize taxes84

378. Financial AccoutingAccounting information and analyses prepared for people outside the organization

379. Information goes to:

380. Prospective owners

381. Creditors & Lenders

382. Employee Unions

383. Customers

384. Suppliers

385. Government agencies

386. General Public 85

387. Financial AccountingThese users are interested in the organizations profits, abilities to pay its bills, and other financial information

388. Information usually contained in the company’s annual report

389. Information must be accurate

390. Financial Accounting Standards Board defines the set of generally accepted accounting principles accountants must follow86

391. Auditing The job of reviewing and evaluating the records used to prepare a company’s financial statements

392. Ensures that proper accounting procedures and financial reporting is being carried out within the organization

393. Examine the financial health of an organization as well as operational efficiencies and effectiveness87

394. Tax AccountingThe preparing of tax returns and developing tax strategies

395. Tax accountant: an accountant trained in tax law and responsible for preparing tax returns or developing tax strategies

396. Taxes are the price we pay for roads, parks, schools, police protection, the military, and other functions provided by the government.

397. Federal, state, and local governments require submission of tax returns that must be filed at specific times & in a precise format88

398. Tax AccountingGovernments often change tax policies according to specific needs or objectives

399. Tax Accountants must continually monitor tax laws89

400. Government and not for profit accountingAccounting system for organizations whose purpose is not generating a profit but serving ratepayers, taxpayers, and others according to a duly approved budget.

401. Governments require an accounting system that satisfies the needs of their information users.

402. The primary users of government accounting information are citizens, special interest groups, legislative bodies, & creditors.90

403. Government and Not for Profit AccountingUsers want to make sure the government is fulfilling its obligations and making the proper use of taxpayers money

404. GASB sets the government accounting standards

405. FBI, IRS, Missouri Department of Natural Resources, & Cook County Department of Revenue are a few government agencies offering career possibilities in accounting.91

406. Government and Not for Profit Accounting Not for profit organizations require accounting professionals as well

407. Contributors want to see where there money is being spent92

408. Accounting versus Bookkeeping Accounting: the recording, classifying, summarizing, and interpreting of financial events and transactions to provide management and other interested parties the information they need to make good decisions

409. Bookkeeping: the recording of business transactions

410. Bookkeeping is important in financial reporting but accounting goes far beyond the mere recording of financial information

411. Accountants classify and summarize financial data provided by bookkeepers, and then interpret the data and report the information to management as well as suggest strategies for improving the financial condition and progress of the firm93

412. Accountants versus BookkeepingAccountants classify and summarize financial data provided by bookkeepers, and then interpret the data and report the information to management as well as suggest strategies for improving the financial condition and progress of the firm

413. Accountants are important in financial analysis and income tax preparation94

414. BookkeepersTasks include:

415. Dividing all of the firm’s transactions into meaningful categories such as: sales documents, purchasing receipts, & shipping documents

416. Keep information organized and manageable

417. Recording financial data from the original transaction documents into record books called journals

418. Bookkeepers record all there transactions into two places( the journals and ledgers) 95

419. The Six – Step Accounting CycleAccounting cycle: A six-step procedure that results in the preparation and analysis of the major financial statements.

420. Requires the work of the bookkeeper and the accountant

421. The first three steps are continualAnalyzing and categorizing documentsPutting the information into journalsPosting that information into ledgersPreparing a trial balancePrepare the financial statements (including balance sheet, income statement, and statement of cash flows)Analyze the financial statements and evaluates the financial condition of the firm Note: Computers and accounting software have simplified this process considerably96

422. Various Accounting Software ProgramsAccounting software simplifies the mechanical tasks involved in accounting, enabling managers and other interested users to get financial reports exactly when and how they want

423. Financial information & transactions can be recorded by hand or by computer

424. Accounting software packages include programs that handle tasks involving:

425. General ledgers

426. Sales processing

427. Accounts receivable

428. Purchase orders

429. Accounts payable

430. Cash flow analysis

431. Inventory control

432. Tax returns (tax accounting software)

433. Tax planning (tax accounting software)97

434. Accounting SoftwareTop Ten Low- End Accounting Software programs for companies with up to $5 million in Revenue

435. Business Vision 32 (Softline)

436. BusinessWorks (Best Software)

437. Small Business Manager (Microsoft/ Great Plains)

438. M.Y.O.B. (M.Y.O.B. Software)

439. Oracle Small Business Suite (formerly Netledger)

440. Peachtree Complete Accounting 2004 (Best Software)

441. QuickBooks for the Web (Intuit)

442. QuickBooks Pro 2002 (Intuit)

443. Simply Accounting (ACCPAC International)

444. Vision Point 2000 (ACCPAC)98

445. Accounting Software Top Ten Middle Market Accounting Software Programs for companies with $2 million to $50 million in Revenue)

446. ACCPAC Advantage Series Corporate Edition (ACCPAC International)

447. ACCPAC ProSeries (ACCPAC International)

448. Accountmate (Softline)

449. BusinessVision 32 (Softline)

450. SYSPRO (SysproUSA)

451. MAS 90 & MAS 200 (Best Software)

452. Navision (Microsoft)

453. Solomon (Microsoft)

454. SouthWare Excellence Series (SouthWare)

455. TRAVERSE (Open Systems)99

456. Accounting Software Top Ten Accounting Software programs in the Beginning ERP Market for companies with $25 mlillion to $500 million in Revenue

457. ACCPAC Advantage Series Enterprise Edition (ACCPAC International)

458. ACCPAC ProSeries (ACCPAC International)

459. Axapta (Microsoft Software)

460. Epicor (Epicor Software)

461. e-Business Suite (Oracle)

462. Great Plains (Microsoft)

463. SYSPRO (SysproUSA)

464. MAS 500 (Best Software)

465. Navision (Microsoft)

466. Solomon (Microsoft) 100

467. Accounting Software Top Ten Accounting Software programs for companies with revenue ranging from $250 million and up

468. ACCPAC Executive Series (ACCPAC)

469. Axapta (Microsoft)

470. Epicor (Epicor)

471. MAS 500 (Best Software)

472. Great Plains (Microsoft)

473. Lawson Enterprise 400 (Lawson Software)

474. One World (J.D. Edwards)

475. Oracle Financials (Oracle)

476. PeopleSoft (PeopleSoft)

477. SAP R/3 (SAP)101

478. Accounting Software Program ProblemsMany accounting software programs suffer from obvious problems such as:

479. older technology

480. Proprietary technology

481. Lack of support

482. Lack of adequate size customer base

483. Lack of distribution channel

484. Poor performance on a local area network

485. Bugs

486. Missing modules

487. Missing key features

488. Lack of capital102

489. Attributes to look for in Accounting SoftwareThe product must have good, clean, stable code

490. The product must have underlying technology

491. The product must have a good company & leadership behind the product

492. The product must have strong financial reporting capabilities

493. The product must have a sizable customer base

494. The product must have a well developed & knowledgeable VAR channel103

495. Attributes to look for in Accounting Software The product must have a wide breadth of modules

496. The product must have a well developed offering of third party add on products

497. There should be a minimal number of missing features

498. There should be no significant problems (such as missing modules, etc) 104

499. Articles to Read on Accounting Software 1. 10 Step Blueprint for Evaluating and Selecting Entry Level Accounting Software2. 25 Step Blueprint for Evaluating and Selecting Mid-Range to High-End Accounting Software3. Listing of 50 Key Features4. Feature Table5. ASA Power Rating Based Upon 350 Key Features6. A Discussion About Evaluating Accounting Software105

500. ERP Although examples of accounting software have been discussed – ERP is suggested and discussed in more detail in this power point. 106

501. Sample Balance Sheet & Income StatementA Sample Balance Sheet and Income Statement will be attached with this power point as well as in the paper. 107

502. Accounting and Bookkeeping Accounting and bookkeeping is a bit more detailed. The next few slides will be accounting terms which the owner of a corporation should be familiar with.

503. Although hiring professionals to do the job- knowledge is power and if you know every aspect of your company your organization will be more successful

504. Before owning a place such as McDonald’s the owners are required to know everything from making an ice cream cone to bookkeeping. The same should apply for owning your own corporation.

505. Chapters about accounting – sample balance sheets & income statements will be attached to the paper accompanying this power point. 108

506. Important Accounting and Bookkeeping Terms managerial accountingAccounting used to provideinformation and analyses tomanagers within theorganization to assist themin decision making.certified managementaccountant (CMA)A professional accountantwho has met certaineducational and experiencerequirements, passed aqualifying exam in the field,and been certified by theInstitute of CertifiedManagement Accountants.financial accountingAccounting information andanalyses prepared forpeople outside theorganization.annual reportA yearly statement of thefinancial condition,progress, and expectationsof an organization.private accountantsAccountants who work for asingle firm, governmentagency, or nonprofitorganization. public accountantAn accountant whoprovides his or heraccounting services toindividuals or businesses ona fee basis.certified public accountant(CPA)An accountant who passes aseries of examinationsestablished by the AmericanInstitute of Certified PublicAccountantsauditingThe job of reviewing andevaluating the records usedto prepare a company’sfinancial statements.independent auditAn evaluation and unbiasedopinion about the accuracyof a company’s financialstatements.certified internal auditor(CIA)An accountant who has abachelor’s degree and twoyears of experience ininternal auditing, and whohas passed an examadministered by theInstitute of InternalAuditors.109

507. Important Accounting and Bookkeeping Termstax accountantAn accountant trained intax law and responsible forpreparing tax returns ordeveloping tax strategies.government and not-for-profitaccountingAccounting system fororganizations whosepurpose is not generatinga profit but servingratepayers, taxpayers,and others according toa duly approved budget.bookkeepingThe recording of businesstransactions.journalThe record book or computerprogram where accountingdata are first entered.double-entry bookkeepingThe concept of writingevery business transaction intwo places.accounting cycleA six-step procedure thatresults in the preparationand analysis of the majorfinancial statements.ledgerA specialized accountingbook or computer programin which information fromaccounting journals isaccumulated into specificcategories and posted sothat managers can find allthe information about oneaccount in the same place.trial balanceA summary of all the data inthe account ledgers to showwhether the figures arecorrect and balanced.financial statementA summary of all thetransactions that haveoccurred over a particularperiod.fundamental accountingequationAssets _ liabilities _owners’ equity; this is thebasis for the balance sheet.balance sheetThe financial statement thatreports a firm’s financialcondition at a specific time.assetsEconomic resources (thingsof value) owned by a firm.110

508. Various Accounting and Bookkeeping TermsliquidityHow fast an asset can beconverted into cash.current assetsItems that can or will beconverted into cash withinone year.fixed assetsAssets that are relativelypermanent, such as land,buildings, and equipment.intangible assetsLong-term assets (e.g.,patents, trademarks,copyrights) that have noreal physical form but dohave value.liabilitiesWhat the business owes toothers (debts).owners’ equityThe amount of the businessthat belongs to the ownersminus any liabilities owedby the business.retained earningsThe accumulated earningsfrom a firm’s profitableoperations that were keptin the business and not paidout to stockholders individends.income statementThe financial statement thatshows a firm’s profit aftercosts, expenses, and taxes; itsummarizes all of theresources that have comeinto the firm (revenue), allthe resources that have leftthe firm, and the resultingnet income.net income or net lossRevenue left over after allcosts and expenses,including taxes, are paid.revenueThe value of what isreceived for goods sold,services rendered, and otherfinancial sources.cost of goods sold (or costof goods manufactured)A measure of the cost ofmerchandise sold or cost ofraw materials and suppliesused for producing items forresale.gross profit (gross margin)How much a firm earned bybuying (or making) andselling merchandise.111

509. Various Accounting and Bookkeeping TermsFinancial forecasting: A forecast of the expected financial position and the results of operations and cash flows based on expected conditions– a prediction about how things will developFinancial reportingThe process of preparing and distributing financial information to users of such information in various forms. The most common format of formal financial reporting are financial statements and financial statements are prepared in accordance with rigorously applied standards defined by professional accounting bodies developed according to the legal and professional framework of a specific locale.Accounts Payable: a file or account that contains money that a person or company owes to suppliers, but has not paid yet (a form of debt). When you receive an invoice you add it to the file, and then you remove it when you pay. Accounts Receivable:: one of a series of accounting transactions dealing with the billing of customers who owe money to a person, company or organization for goods and services that have been provided to the customer. The total amount owed to a company due to debts arising from sales on credit or on account.Order Entry: The first part of data processing to enter an order or pickup in the computer system. A computerized relational database that, at a minimum, generates, schedules and maintains estimates, sales orders, and backlogs. Invoices may also be created automatically if linked to Accounts Receivable. More advanced order entry systems are usually fully integrated with the accounting system. Procurement: The combined functions of purchasing, inventory control, traffic and transportation, receiving, inspection, store keeping, and salvage and disposal operations.The accounting dictionary will need to be read and the one online can be found athttp://www.ventureline.com/Glossary_A.aspI have not covered all terms but ones which will need to be known. I strongly suggest knowing as much as possible about each department. 112

510. Various Accounting and Bookkeeping Termsoperating expensesCosts involved in operatinga business, such as rent,utilities, and salaries.statement of cash flowsFinancial statement thatreports cash receipts anddisbursements related to afirm’s three major activities:operations, investments,and financing.cash flowThe difference betweencash coming in and cashgoing out of a business.depreciationThe systematic write-off ofthe cost of a tangible assetover its estimated useful life.first in, first out (FIFO)An accounting method forcalculating cost ofinventory; it assumes thatthe first goods to come inare the first to go out.last in, first out (LIFO)An accounting method forcalculating cost ofinventory; it assumes thatthe last goods to come inare the first to go out.ratio analysisThe assessment of a firm’sfinancial condition andperformance throughcalculations andinterpretations of financialratios developed from thefirm’s financial statements. 113

511. Sample Fiberrific Balance Sheet and Income StatementSAMPLE FIBERRIFIC BALANCESHEET➀ Current assets: Itemsthat can be convertedto cash within oneyear.➁ Fixed assets: Itemssuch as land,buildings, andequipment that arerelatively permanent.➂ Intangible assets:Items of value such aspatents andcopyrights that don’thave a physical form.➃ Current liabilities:Payments that are duein one year or less.➄ Long-term liabilities:Payments not due forone year or longer.➅ Stockholders’ equity:The value of whatstockholders own in afirm (also calledowners’ equity.SAMPLE FIBERRIFIC INCOMESTATEMENT➀ Revenue: Value ofwhat’s received fromgoods sold, servicesrendered, and otherfinancial sources.➁ Cost of goods sold:Cost of merchandisesold or cost of rawmaterials or partsused for producingitems for resale.➂ Gross profit: Howmuch the firm earnedby buying or sellingmerchandise.➃ Operating expenses:Cost incurred inoperating a business.➄ Net income aftertaxes: Profit or lossover a specific periodafter subtracting allcosts and expenses,including taxes.114

512. Fiberrific Statement of Cash FlowFIBERRIFIC STATEMENT OFCASH FLOWS➀ Cash receipts fromsales, commissions,fees, interest, anddividends. Cashpayments for salaries,inventories, operatingexpenses, interest,and taxes.➁ Includes cash flowsthat are generatedthrough a company’spurchase or sale oflong-term operationalassets, investments inother companies, andits lending activities.➂ Cash inflows andoutflows associatedwith the company’sown equitytransactions or itsborrowing activities. 115

513. The Income Statement The formula used to prepare an income statement is as follows:Revenue – Cost of goods sold= Gross ProfitsGross Profit – Operating expenses= Net Income before taxesNet Income before taxes – Taxes = Net income (or loss)116

514. Key Financial Statements of a BusinessBalance Sheet - reports the firm’s financial condition on a specific dateIncome Statement - summarizes revenues, cost of goods, and expenses(including taxes), for a specific period of time and highlights the total profit or loss the firm experienced during that periodStatement of Cash Flows - provides a summary of money coming into and going out of the firm that tracks a company’s cash receipts and cash payments117

515. Fundamental Accounting EquationBasis for the balance sheet

516. Assets=Liabilities+Owners equity $80,000 = $30,000 + $50,000The assets are equal to or are balanced with the liabilities and owners’ (stockholders’) equity.

517. Complicated part is determining what is included in the asset account and what is included in the liabilities and owners’ equity accounts

518. Sample’s provided simplify and explain the process 118

519. Three Categories of AssetsCurrent Assets are items that can or will be converted into cash within one year. Current assets include cash, accounts receivable, and inventoryFixed Assets are long term assets that are relatively permanent such as land, buildings, and equipmentIntangible assets are long term assets that have no real physical form but do have value. Patents, trademarks, copyrights, and goodwill are examples of intangible assets 119

520. The Statement of Cash FlowsThe statement of cash flows reports cash receipts and disbursements related to the three major activities of a firm:Operations are cash transactions associated with running the businessInvestments are cash used in or provided by the firms investment activitiesFinancing is cash raised from the issuance of new debt or equity capital or cash used to pay business expenses, past debts, or company dividends120

521. Liabilities and Owners’ EquityThe following are common liability accounts recorded on a balance sheet:Accounts payable are current liabilities involving money owed to others for merchandise or services purchased on credit but not yet paid. If you have a bill you have not paid, you have an account payableNotes payable are short term or long term liabilities ( ex loans from banks) that a business promises to repay by a certain dateBonds payable are long term liabilities that represent money lent to the firm that must be paid back. If a firm sells someone a bond, it agrees to repay that person the money he or she lent the company plus interest. 121

522. Analyzing Financial Statements: Ratio AnalysisRatio analysis: the assessment of a firm’s financial condition and performance through calculations and interpretations of financial ratios developed from the firm’s financial statements.122

523. Ratio CategoriesLiquidity Ratios

524. Leverage (Debt) Ratios

525. Profitability (Performance) Ratios

526. Activity Ratios 123

527. Liquidity RatiosLiquidity Ratios measure a company’s ability to turn assets into cash to pays its short – term debts (liabilities that must be repaid within one year).

528. Types of liquidity ratios:Current ratio: a ratio of a firm’s current assets to its current liabilities. Can be found on balance sheetAcid – test ratio: measures the cash, marketable securities (such as stocks and bonds), and receivables of a firm, compared to its current liabilities124

529. Liquidity Ratios Current Ratio Current ratio = Current Assets divided by current liabilities 600,000 divided by 228000 = 2.08 Acid Test Ratio Acid-test ratio= Cash + Accounts receivable + Marketable securities divided by Current Liabilities 125

530. Leverage Debt Ratios Leverage (Debt) Ratios measure the degree to which a firm relies on borrowed funds in its operations

531. Types of Leverage Debt Ratio:Debt to owners’ equity ratio measures the degree to which the company is financed by borrowed funds that must be repaid126

532. Leverage (Debt) RatiosDebt to Owners’ Equity ratioDebt to owners equity = Total liabilities divided by owners’ equity127

533. Profitability (Performance ) RatiosProfitability (Performance ) Ratios measure how effectively a firm is using its various resources to achieve profits. Management’s performance is often measured by the firm’s profitability ratios. The three most important ratios used are: earnings per share return on sales return on equity128

534. Profitability (Performance) Ratios Basic earnings per share (basic EPS): helps determine the amount of profit earned by a company for each share of outstanding common stock. Basic earnings per share = Net income after taxes divided by number of common stock shares outstanding. Another reliable indicator of performance is obtained by using a ratio that measures the return on sales. Firms use this ratio to see if they are doing as well as the companies they compete against in generating income from the sales they achieve. Diluted earnings per share (diluted EPS) ratio: measures the amount of profit earned by a company for each share of common stock, but also takes into consideration stock options, warrants, preferred stock, and convertible debt securities, which can be converted into common stock. For simplicity’s sake this power point will only discuss the basic earnings per share (EPS).129

535. Profitability (Performance) RatiosReturn on sales: calculated by comparing a company’s net income to its total sales. Risk is a market variable that concerns investors. The higher the risk involved in an industry, the higher the return investors expect on their investment.Return on sales = Net income divided by net salesReturn on equity: measures how much was earned for each dollar invested by owners. Return on equity= Net income after tax divided by total owners’ equity Note: These and other profitability ratios are considered vital measurements of company growth and management performance. 130

536. Activity Ratios Activity Ratios measure the effectiveness of a firm’s management in using the assets that are available. One of the activity ratios is the inventory turnover ratio.The Inventory turnover ratio measures the speed of inventory moving through the firm and its conversion into sales. Inventory sitting idly in a business cost money.Inventory turnover = cost of goods sold divided by average inventory131

537. Human Resources Human Resources: an increasingly broadening term that refers to managing “human capital” the people of an organization. The field has moved from a traditionally administrative function to a strategic one that recognizes the link between talented and engaged people and organizational success.

538. Human resources management: the process of determining human resource needs and then recruiting, selecting, developing, motivating, evaluating, compensating, and scheduling employees to achieve organizational goals.132

539. Human ResourcesHuman Resources (HR) normally administers:

540. Hiring

541. Promotion

542. Termination

543. Compliance (Personnel regulatory requirements)

544. Training

545. Benefits

546. Payroll

547. Performance assessment133

548. Human Resources Much of the data in a HR system revolves around job titles.Job Title:Description

549. Requirements

550. Pay Grade (pay range)

551. FLSA status

552. EEO categoryHR manuals refer to:Policy and procedures

553. Employee handbook

554. Benefits

555. Training134

556. Human ResourcesEqual Employment Opportunity Commission (EEOC) involves:

557. Employee Demographics

558. Gender

559. Ethnicity

560. Age

561. EEOC Report:

562. EEOC category

563. Gender

564. Ethnicity135

565. Human ResourcesPayroll refers to:

566. Pay rate

567. Benefits

568. Medical, dental, vision

569. Retirement (401K)

570. Vacation

571. Sick leave

572. Family Medical Leave Act (FMLA)

573. Taxes

574. Federal

575. State

576. Local

577. Federal Insurance Contributions Act (FICA)

578. Medicare136

579. Human ResourcesChief Human Resource Officer:

580. Will establish and enhance a world class human resources team

581. Should have at least a Bachelors Degree in Human Resources or business administration or related field

582. Experience desired but not required (depending on the CEO’s and owners wishes)

583. Must be able to define and implement a labor relations strategy that will ensure a positive and productive work environment

584. Challenges HR leaders CHRO faces:

585. Workforce demographics and global talent trends

586. Corporate scandals and intensifying regulatory challenges

587. Rising costs of health care and pensions

588. Technology innovations enabling new ways of working

589. Increasing globalization

590. Endless pressures to boost workforce137

591. Categories of the CHRO’s roles and responsibilitiesWorkforce Strategist: Integrating business strategy and overall performance are increasingly important tasks. As well as supporting and implementing overall workforce strategy, CHROs also have a significant role in developing and informing HR strategy- helping the CEO and other senior managers design strategies that are consistent with global labor trends, available talent and next-generation leadership and employeesOrganizational and Performance Conductor: How do businesses get the best performance from their employees? Organizations are increasingly complex and performance improvements can be required from departments involving: operations across geographic boundaries

592. virtual teams

593. contingent workforces

594. telecommuting

595. job-sharing

596. flexible hours

597. workforce diversity 138

598. Categories of the CHRO’s roles and responsibilitiesWorkforce Strategist: Integrating business strategy and overall performance are increasingly important tasks. As well as supporting and implementing overall workforce strategy, CHROs also have a significant role in developing and informing HR strategy- helping the CEO and other senior managers design strategies that are consistent with global labor trends, available talent and next-generation leadership and employees

599. Organizational and Performance Conductor: How do businesses get the best performance from their employees? Organizations are increasingly complex and performance improvements can be required from departments involving:

600. operations across geographic boundaries

601. virtual teams

602. contingent workforces

603. telecommuting

604. job-sharing

605. flexible hours

606. workforce diversity Note:Modern CHROs need to be able to navigate all such options, acting as change masters and architects of organizational structures and rewards programs. HR Service Delivery Owner: Despite the increasing focus on wider business issues, CHROs must still provide cost-effective, day-to-day HR administration and operations. But they need to devote less time to overseeing their own HR systems and processes and spend more time managing a complex mix of in-house, self-service and external resources. Internal and external services must be blended into a cohesive and seamless working operation..

607. Compliance and Governance Regulator: CHROs must work directly with their boards on employee issues directly related to the critical areas of:

608. risk management

609. regulatory compliance

610. ethics

611. integrity Additionally, they are expected also to assist with a wide range of board-related issues, such as board member selection and orientation, executive compensation and succession planning. 139

612. Human Resource ChallengesChallenges in Human Resources

613. Shortages in people trained to work in the growth areas of the future.

614. A complex set of laws and regulations involving hiring, safety, unionization, and equal pay requiring organizations to go beyond a profit orientation and be more fair and socially conscious

615. Retraining of certain employees

616. Increasing number of single parent and two income families resulting in demands for job sharing, maternity leave, and special programs

617. Challenges in Human Resources

618. Shift in employee attitudes towards work

619. Continuous downsizing

620. Increased demand for benefits being tailored to the individual

621. A decreased sense of employee loyalty

622. Recruiting employees from a diverse population

623. Selecting productive employees

624. Hiring competent workers

625. Training and Developing Employees

626. Management development

627. Diversity in Management Development140

628. Human Resource ChallengesChallenges in Human Resources

629. Networking

630. Attracting and Keeping the best employees

631. Pay Systems

632. Compensating Teams

633. Fringe Benefits

634. Scheduling Employees to Meet Organizational and Employee Needs

635. Job Sharing Plans

636. Promoting and Reassigning Employees

637. Termination of Employees

638. Retiring Employees

639. Laws affecting Human Resources

640. Effects of Legislation141

641. Employees Needed in Human ResourcesCHRO

642. Recruiter

643. Employee Relations Manager

644. Compensation and Benefits Manager

645. Employee Relations Specialist

646. Administrative Assistant (a secretary)

647. HR Coordinator

648. Human Resource Assistance

649. Human Resource Administrator

650. Director of Human Resources

651. Human Resource Manager

652. Compensation Analyst

653. Staffing Specialist

654. Coordinator of Human Resources

655. HR Assistant

656. Payroll Specialist

657. Workforce Planning Specialist

658. Human Resources Cordinator

659. Recruiter

660. Human Resources Specialist

661. Human Resource Benefits Administration

662. HR Generalist

663. More or not as many as mentioned on here – depending on CHRO’s and CEO’s decisions142

664. Software Programming Each computer will have Microsoft Office Ultimate but the programming for Human Resources will be included in the ERP which is mentioned later in this power point. 143

665. Information Technology DepartmentInformation Technology::

666. The development, installation, and implementation of computer systems and applications.

667. A major facilitator of business activities in the world today144

668. Chief Information Officer Chief Information Office (CIO):

669. Head of the Information Technology Department

670. Expertise in computer science, software engineering, and/or information systems

671. Many CIO’s hold a Master of Business Administration or Master of Science in Management as well as a technical background

672. Must also have leadership capabilities, business acumen and strategic perspectives as well as technical skills

673. Delegates responsibilities and answers to the CEO145

674. Chief Information Officer (CIO)Chief Information Officer (CIO) will have significant Information Technology leadership experience and specialty expertise in one or more of the following areas:

675. ERP implementation and migration

676. Instructional Technology

677. Infrastructure and Networking

678. Administrative systems design and development

679. Excellent references

680. Demonstrate superior communication skills

681. Education in business management and Information Technology 146

682. Information Technology Top Seven OccupationsComputer software application engineersComputer support specialistsComputer software systems engineersNetwork and computer systems administratorsNetwork systems and data communications analystsDesktop publishersDatabase administratorsNote: the corporation will rely on the Chief Information Officer and CEO to decide which will be necessary within the IT department. Each department will need a secretary147

683. Information TechnologyInformation Technology is a catalyst of fundamental changes in the strategic structure, operations, and management of organizations due to the following capabilities:

684. Performing high speed, high volume, numerical computations

685. Providing fast, accurate, reliable, and inexpensive communication within and between organizations, any time, any place

686. Storing huge amounts of information in an easy-to-access, yet small space

687. Allowing quick and inexpensive access to vast amounts of information worldwide at any time

688. Enabling collaboration anywhere, any time

689. Increasing the effectiveness and efficiency of people working in groups in one place or in several locations148

690. Information TechnologyVividly presenting information that challenges the human mind

691. Facilitating work in hazardous environments

692. Automating both semiautomatic business processes and manually doing tasks

693. Facilitating interpretation of vast amounts of data

694. Facilitating global trade

695. Enabling automation of routine decision making and facilitating complex decision making

696. Can be wireless, thus supporting unique applications anywhere

697. Accomplishing all of the above much less expensively than when done manually149

698. Information Systems and Information TechnologyInformation Systems:

699. Collects, processes, stores, analyzes, and disseminates information for a specific purpose

700. Includes inputs (data, instructions) and outputs(reports, calculations)

701. Processes the inputs by using technology such as PCs and produces outputs that are sent to users or to other systems via electronic networks.

702. Information Systems also include people, procedures, and physical facilities and it operates within an environment

703. Not necessarily computerized although most of them are

704. Information Technology:

705. The collection of computing systems used by an organization

706. The technological side of an information system including: hardware, software, databases, networks, and other electronic devices

707. A subsystem of an information system150

708. Information Systems and Information TechnologyInformation Technology

709. The organization’s collection of information systems, their users, and the management that oversees them.

710. Difference in Computers and Information Systems

711. A computer provides effective and efficient ways of processing data and a necessary part of an information system

712. An information system involves much more than computers. The successful application of an IS requires an understanding of the of the business and its environment that is supported by the IS. For example, to build an IS that supports transactions executed on the New York Stock Exchange, it is necessary to understand the procedures related to buying & selling stocks, bonds, options, and so on, including irregular demands made on the system, as well as all related government regulations151

713. Information Systems & Information Technology In learning about Information Systems, it is therefore not sufficient to just learn about computers as computers are only one part of a complex system that must be designed, operated, and maintained.152

714. Information Technology153

715. Information Technology 154

718. Information Technology 157

719. Information TechnologyThe Information Technology Department is responsible for management, support and implementation of the technology architecture, hardware, software and the respective resources throughout the organization. 158

720. Managerial Issues in ITRecognizing opportunities for using IT and Web-based systems for strategic advantage

721. Who will build, operate, and maintain the information systems

722. How much IT

723. How important is IT

724. Globalization

725. Ethics and social issues

726. Transforming the organization to the digital economy159

727. Enterprise Resource Planning (ERP)The ERP system will be discussed in the next few slides. The IT department should be or will be the creator and maintainer of the ERP160

728. Enterprise Resource Planning (ERP) Enterprise Resource Planning (ERP):

729. ERP is a way to integrate the data and processes of an organization into one system

730. A process or approach which attempts to consolidate all of a company’s departments and functions into a single computer system that services each department’s specific needs.

731. It is a convergence of people, hardware & software into an efficient production, service and delivery system that creates a profit for the company.

732. A company –wide computer software system used to manage and coordinate all the resources, information, and functions of a business from shared data stores

733. Typically has modular hardware and software units and “services” that communicate on a local area network

734. The modular design allows a business to add or reconfigure modules while preserving data integrity in one shared database that may be centralized or distributed

735. Has an integrated Accounting System

736. Usually ERP systems will have many components including hardware and software, in order to achieve integration

737. Most ERP systems use a unified database to store data for various functions found throughout the organization161

738. Enterprise Resource Planning ImplementationThe steps of a data migration strategy help with the success of an ERP implementation:Identifying the data to be migratedDetermining the timing of data migrationGenerating the data templatesFreezing the tools for data migrationDeciding on migration related setupsDeciding on data archiving162

739. Enterprise Resource PlanningIn order for a software system to be considered ERP, it must provide an organization with functionality for two or more systems

740. Most cover several functions although a few cover only two functions (ex QuickBooks: Payroll & Accounting)

741. Today’s ERP systems can cover a wide range of functions

742. Examples of modules in an ERP which formerly would have been stand- alone applications include: Product lifecycle management, Supply chain management (ex purchasing, manufacturing and distribution), Warehouse Management, Customer Relationship Management (CRM), Sales Order Processing, Online Sales, Financials, Human Resources, and Decision Support System.163

743. Enterprise Resource Planning Ideally, ERP delivers a single database that contains all data for the software modules which would include:

744. Manufacturing: engineering, bill of materials, scheduling, capacity, workflow management , quality control, cost management, manufacturing process, manufacturing projects, manufacturing flow

745. Supply chain management: order to cash, inventory, order entry, purchasing, product configurator, supply chain planning,, supplier scheduling, inspection of goods, claim processing, commission calculation

746. Financials: general ledger, cash management, accounts payable, accounts receivable, fixed assets

747. Project management: costing, billing, time and expense, performance units, activity management

748. Human Resources: human resources, payroll, training, time and attendance, rostering, benefits164

749. Enterprise Resource PlanningCustomer relationship management: sales and marketing, commissions, service, customer contact and call center support

750. Data Warehouse and various self service interfaces for customers, suppliers, and employees

751. Access control- user privledge as per authority levels for process execution

752. Customization- to meet the extension, addition, change in process flow

753. Note: This varies from each organization and more or less can be expected165

754. Enterprise Resource Planning Process PreparationERP vendors have designed their systems around standard business processes based upon best business practices

755. Different vendors have different types of processes

756. Crucial organizations perform a thorough business process analysis before selecting an ERP vendor and setting off on the implementation track

757. The analysis should map out all present operational processes, enabling selection of an ERP vendor whose standard modules are most closely aligned with the established organization

758. Redesign can then be implemented to achieve further process congruence.166

759. Enterprise Resource Planning Process PreparationResearch indicates that the risk of business process mismatch is decreased by:

760. Linking each current organizational process to the organization’s strategy;

761. Analyzing the effectiveness of each process in light of its current related business capability

762. Understanding the automated solutions currently implemented

763. ERP implementation is considerably more difficult in organizations structured into nearly independent business units, each responsible for their own profit and loss, because they will have different processes, business rules, data semantics, authorization hierarchies and decision centers.

764. For more on ERP it is advised to consult with an ERP specialist167

765. Links on ERPhttp://www.tech-faq.com/enterprise-resource-planning-erp.shtml

766. http://en.wikipedia.org/wiki/Enterprise_resource_planning168

767. Enterprise Resource Planning 169

768. Vendors of ERP & other integrated business information systems Examples of integrated business information systems are:

769. Enterprise Resource Planning (ERP)

770. Manufacturing Resource Planning (MRPII)

771. Customer Relationship Management (CRM)

772. Human Resource Management System (HRMS)

773. Financial System

774. Some major system vendors are:

775. Oracle

776. SAP

777. IBM170

778. Recommended SoftwareERP setup as mentioned

779. Consult with a professional

780. Microsoft Office Ultimate

781. Already discussed the accounting software programs

782. Each executive and others will need a Blackberry phone from AT&T

783. Barcode Planet

784. Dolphin 9900 Mobile Computers from Honeywell

785. Other products from Barcode Planet

786. 1-888-875-7373

787. http://www.barcodeplanet.com/honeywell/dolphin-9900.htm171

788. Operations Management & LogisticsOperations form the base of every organization. Operations Management & Logistics comprises disciplines such as: product development (television show development- DVD’s- shirts- website content- etc), quality management, logistics, information systems and human resources management.

789. Operations extend from the performance management of a group of design engineers or building in quality feedback loops to the precise prediction of production and delivery performance (production of a show or movie). Supply chain management and the design of information architectures for e-business are also a part of operations management.

790. Logistics is the management of the flow of goods, information and other resources, including energy and people, between the point of origin and the point of consumption in order to meet the requirements of consumers.

791. Logistics involves the integration of information, transportation, inventory, warehousing, material handling, and packaging, and occasionally security.

792. Logistics is a channel of the supply chain which adds the value of time and place utility172

793. Operations Management & Production ManagementProduction Management has been the term to describe all the activities managers do to help their firms create goods. To reflect the change in importance from manufacturing to services, the term production has been replaced by operations to reflect both goods and services production

794. Production Management:

795. The term used to describe all the activities managers do to help their firms create goods.

796. Production Management & Operations Management includes the creation and managing of goods and services using the factors of production-land, labor, capital, entrepreneurship, human resources, and knowledge 173

797. Operations Management and Production ManagementOperations Management:

798. A specialized area in management that converts or transforms resources (including human resources) into goods and services.

799. Operations Management includes:

800. Inventory Management

801. Quality Control

802. Production Scheduling

803. Follow up services

804. Creating services/products

805. Other services as well

806. Operations Management transforms:

807. Human Resources

808. Raw Materials

809. Supplies

810. Other resources

811. Operations Management(for a production company):

812. Takes Inputs (information, actors, actresses, CEO’s, etc…), buildings, offices, & computer systems, etc.. and creates services that transform the shows, actors/actresses/camera ppl/etc… into a successful business 174

813. Operations ManagementSome organizations produce mostly goods and others produce goods and services. Production companies produce goods and services

814. Operations Management in Action Includes:

815. Hiring Specialists who study the latest in production techniques & can set up world class systems

816. Consultants

817. Streamline processes

818. Facility location

819. Internet networking

820. Facility layout

821. Quality control

822. Quality function deployment

823. ISO Standards

824. Measuring quality (satisfaction)

825. Manufacturing processes

826. Materials requirement planning

827. Enterprise resource planning

828. Other services and actions as well175

829. Operations ManagementOperations Management in Action Includes:

830. Knowing Modern Production Techniques

831. Just in time Inventory Control

832. Internet purchasing

833. Flexible Manufacturing(production of shows- not flexible to break the rules or act unethical)

834. Lean Manufacturing

835. Mass customization

836. Competing in Time

837. Computer Aided Design and Manufacturing

838. Control Procedures: PERT and GANTT Charts

839. Preparing for the future176

840. Operations and LogisticsOperations and Logistics emphasize the following to capture the competitive edge:

841. Focusing on customers

842. Maintaining close relationships with suppliers and other companies to satisfy customer needs

843. Practicing continuous improvement

844. Focusing on quality

845. Saving on costs through site selection

846. Relying on the Internet

847. Adopting new techniques such as enterprise resource planning, computer integrated manufacturing, flexible manufacturing, and lean manufacturing177

848. Operations and Logistics Operations and Logistics often focus on:

849. Production

850. Inventory

851. Supply chain

852. Processes

853. Strategic Planning178

854. Chief Operating Officer Chief Operating Officer:

855. The corporate officer responsible for managing the day to day activities of the corporation and for operations management

856. Highest ranking employee in the Operations Department and is in charge of the Operations Department

857. Monitors the daily operations of the company and reporting to the board of directors and the top executive

858. Responsible or design, development, operation, and improvement of the systems that create and deliver the firms products and services.

859. Responsible for ensuring that business operations are efficient and effective and that proper management of resources, distribution of goods & services to customers, and analysis of queue systems is done

860. Needs to have domain knowledge of the business and industry, understand modern management theories, employ process/quality improvement techniques (business process reengineering, Six Sigma) and quality process standards179

861. Function of a Chief Operating Officer Marshal limited resources as set out by the chief executive officer and board of directors to the most productive uses with the aim of creating maximum value for the company’s stakeholdersLead by developing and cascading the organization’s strategy/mission statement to the lower ranking staff, and implementing appropriate rewards/recognition and coaching/corrective practices to align personnel with company goalsPlan by prioritizing customer, employee and organizational requirementsMaintaining and monitoring staffing, levels, Knowledge-Skill-Attitude (KSA), expectations and motivation to fulfill organizational requirementsDrive performance measures for the measurement of an operation’s performance and consideration of efficiency versus effectiveness, often in the form of dashboards convenient for review of high level indicators180

862. Sales and MarketingMarketing vs. Sales: What is the difference?

863. Marketing is everything you do to reach and persuade prospective customers

864. Sales is everything you do to close the sale and get a signed agreement or contract

865. Marketing: the process of planning and executing the conception, pricing, promotion, and distribution of goods or services to facilitate exchanges that satisfy individual and organizational objectives. Selling and advertising are a part of marketing but marketing involves much more. 181

866. Sales and Marketing DepartmentSales and Marketing Department:

867. Focuses on the needs of the buyer and the need to satisfy the customer through products produced

868. Marketing guides and controls the entire operation, with manufacturing playing the role of a service activity and supplying the products needed by the customer as relayed to it by marketing

869. Monitors the competition and focuses on the customer

870. Creates new ideas

871. Sets the strategy, plans the attack, and executes

872. Advertising and sells182

873. Chief Marketing OfficerChief Marketing OfficerThe executive responsible for various marketing in an organization

874. Primary or shared responsibility for areas such as: sales management, product development, distribution channel management, public relations, marketing communications (including advertising and promotions), pricing, market research, and customer service.

875. Must be knowledgeable in a range or disciplines

876. Must be among many other things- highly analytical (ex- pricing and market research) to highly creative (advertising and promotions)

877. Must have excellent leadership style

878. Must possess areas outside of marketing such as production, information technology, legal, and financing

879. Educational requirements vary but a Master of Business Administration is one degree which will make a good Chief Marketing Officer

880. Experience would be preferred but a educated and talented individual with no experience would do183

881. The Marketing ConceptCustomer Orientation: Find out what consumers want and provide it for them (note emphasis on consumers rather than promotion or sales)Service Orientation: Make sure everyone in the organization has the same objective- customer satisfaction. This should be a total & integrated organizational effortProfit Orientation: Focus on those goods and services that will earn the most profit and enable the organization to survive and expand to serve more consumer wants and needs.184

882. Marketing Mix Product PricePlace Promotion185

883. The Marketing Process with the Four P’s186Find opportunities  Conduct Research Identify a target market Design a product to meet the need based on research Do product testing Determine a brand name, design a package, and set a price Select a distribution system Design a promotional program Build a relationship with customers

884. The Marketing EnvironmentSocioculturalPopulation Shifts

885. Values

886. Attitudes

887. TrendsCompetitiveSpeed

888. Service

889. Price

890. SelectionTechnologicalComputers

891. Telecommunications

892. Bar codes

893. Data interchange

894. Internet changesGlobalTrade agreements

895. Competition

896. Trends

897. Opportunities

898. InternetEconomicGDP

899. Disposable income

900. Competition

901. Unemployment187

902. The Consumer Decision Making Process & Outside InfluencesMarketing mix influencesProduct

903. Price

904. Place

905. PromotionPsychological InfluencesPerception

906. Attitudes

907. Learning

908. MotivationSociocultural influencesReferences groups

909. Family

910. Social class

911. Culture

912. SubcultureSituational influencesType of purchase

913. Social surroundings

914. Physical surroundings

915. Previous experience188

916. Sales Sales ProjectionDemand forecasting

917. Sales forecastingSales TrackingGoals

918. Leads

919. Contacts

920. ClosingsSales ReportsBy company

921. By region

922. By department

923. By team

924. By salesperson

925. By product

926. By consumer

927. By sourceSales ComparisonsYear over year

928. Quarter over quarter

929. Month over month189

930. Marketing & Sales Department The Marketing & Sales Department usually has the information listed below on hand:

931. Historical sales

932. Files of past marketing research, marketing plans, and design awards

933. Sales database

934. Production Records

935. Profit and Loss Statements by Item and Group

936. Marketing Budget

937. Marketing Budget Anticipated Results

938. Other information as well190

939. Marketing & Sales DepartmentThe Marketing & Sales Department involves much more than discussed in this power point. The department will need a Chief Creative Officer and other talented and driven employees. The power point with this department and others introduces the department and discusses a few things about each department. Further research by the owner must be conducted. 191

940. Legal Department The legal department will require the best of the best. The attorneys must be sharks so to say. The attorneys must be aware of all laws ranging from tax laws to copyright laws and everything in between. Below are a few laws which influence business in America:Minimum wage laws

941. Environmental protection laws

942. Consumer protection laws

943. Worker safety laws (OSHA)

944. Discrimination laws

945. Union regulations

946. Local laws and licenses (as well as foreign )

947. Incentives

948. Copyright and patent laws

949. Anti monopoly laws

950. Product litigation

951. Other laws as well192

952. ClosingThis presentation does not go in depth and further research must be done before opening a corporation but this presentation briefly familiarizes the reader with the setting up and running of a corporation.

953. Knowledge is power and knowing as much as you can about the corporation you open enables you to run a successful business.

954. More departments might be required such as mailing, administration, and engineering.

955. Other chief officers will be required as well- ex: Chief Technical Officer- Chief Technology Officer- Chief Compliance Officer- etc…. 193

956. References Understanding Business

957. Organizational Behavior

958. Wikipedia

959. Numerous Online Sources 194

Running, Managing, And Operating A Corporation

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