Letter From the Editor

Abstract

Dear JCAF Reader, I am pleased to announce the appointment of Michael A. Ehrlich, PhD, as the new Associate Editor of JCAF. Dr. Ehrlich will manage relations with the worldwide academic community. He will be responsible for soliciting articles from academic authors. He will oversee the academic review process and work with authors to develop articles for publication. Academic submissions will be directed to Dr. Ehrlich for evaluation by a refereed double-blind peer review team before they are considered by the editor for publication. Other submissions will undergo an editorial review process managed by the editor, Jim Edwards. Dr. Ehrlich is an Associate Professor of Finance in the School of Management at the New Jersey Institute of Technology (NJIT) with a joint appointment in Information Systems. Previously, he was a senior managing director at Bear Stearns, Inc. and an arbitrage trader at Salomon Brothers, Inc. He earned his BA in Economics in 1981 at Yale University and his PhD in Economics/Finance in 1987 at Princeton University. Dr. Ehrlich has extensive research experience resulting in seminars, reports, educational programs, development of research and community outreach centers, and commercialization of technology in addition to published work. He has worked on the problem of financing new ventures and has developed unique data sets and analysis of entrepreneurs attempting to commercialize new technology. He has also studied financial bubbles and written about the failures of the mortgage market and structured investment vehicles during our most recent financial crisis. His research focuses on how and why financial markets fail and seeks to develop practical solutions to address financial market failures. Through his research efforts he has established collaborations with many students, academics, and corporate colleagues. He has forged collaborations to benefit from work with his NJIT colleagues and investigators at other institutions. Dr. Ehrlich has published articles in the Journal of Business Venturing, Journal of Applied Corporate Finance, and seven in the Journal of Corporate Accounting & Finance. This issue features articles on treasury and cash management. Cash is the plasma that moves through economic organizations, keeping them alive. It is the “liquid” asset. Louis P. Le Guyader leads off this issue with “Trapped Excess Cash as a Reporting Challenge.” He points out that increased vigilance is needed because every new management decision or reporting choice is an opportunity for a moral-hazard stumble on the slippery slopes of corporate reporting. In “Various Implications of Excessive and Insufficient Cash Balances for Corporations,” Gregory L. Prescott reports the findings of four studies published in recent years in accounting and finance journals on the subject of cash holdings and various topics of interest to chief financial officers, controllers, and other financial professionals. Thomas D. Schultz and Roger Y. W. Tang tackle the problem of holding significant cash balances offshore to avoid tax consequences associated with repatriations. Such practices can make the amounts unavailable for use in the United States. In “The Strategic Use of Short-Term Loans to Access Offshore Cash,” the authors offer a viable, tax-effective strategy for U.S. multinational corporations seeking to access offshore cash to structure short-term, intercompany loans from their subsidiaries operating as foreign controlled corporations. This effectively makes the cash available for operations in the United States without resulting in immediate repatriation effects. In “The SEC and International Cash Management,” Donald A. Walker Jr. describes the impact of the SEC disclosure rules as they apply to U.S. corporations about transactions with companies in nations that were designated as state supporters of terrorism. Kurt Fanning makes the case for single-account cash management systems in “Benefits of Using a Single-Account Cash Management Structure.” This practice provides corporate treasurers with better visibility and greater control over cash. The author claims that a single-account cash management system provides significant cost savings and reduces risks associated with cash management. “The Importance of Cash Flow Planning for Closely Held Businesses” is made evident by Caroline D. Strobel who is a veteran expert in family business planning. She claims that cash flow planning for owners of closely held businesses is an important component to the ultimate success and continuation of that business. Looking ahead and planning for the smooth transition of a business to new management is necessary for the financial well-being of a family. Data analytics is at the forefront of current interest among many accounting and financial executives. Alan Dybvig provides a follow-on to his September/October 2015 article in JCAF on optimizing the income statement with advanced analytics. In this article the author elaborates on his thinking of the optimized income statement (OIS) from a demand standpoint—as an optimized demand-driven plan (ODDP). He elaborates on this premise, including how sales and marketing activities drive demand/forecast as a dependent variable. He shows how an OIS not only truly maximizes profit but also truly maximizes the return on investment of Sales and Marketing expenditures. Charles R. Thomas Jr. provides an interesting example of lessons learned in “Learning Like Lightning: Lessons from JSF F-35 Sustainment Activities.” Highlights include five key financial management lessons about business cases and projects that are applicable to small organizations and large. Art Worster and his associates, Thomas R. Weirich and Frank Andera, continue their series of articles addressing matters that arise during and after the implementation of integrated IT applications in a business. In this article, “Managing IT Change—A New Role for HR,” the authors present some new and different approaches to workforce management during the times of dramatic change introduced by the implementation of ERP applications. It requires strong leadership from a combination of both HR and financial leadership to develop and sell these programs; and once the outlines are developed, tools to monitor and promote program progress should be developed by HR. Ali Uyer and Ender Boyar take readers into “An Investigation Into Social Media Usage of Publicly Traded Companies.” Social media is becoming an increasingly important platform of business organizations for communication with stakeholders. Firms that explore the power of this new way of communication gain advantages in the marketplace since it enables fast interaction with employees, customers, stockholders, and other stakeholders. A topic that can easily go under the radar screen is presented by Leah Muriel in “Conflict Mineral Disclosure Requirements.” Under the Dodd-Frank Act, U.S. publicly traded companies are now required to provide disclosures related to conflict minerals of tin, tantalum, tungsten, and gold that are obtained from the Democratic Republic of Congo and adjoining countries. Editor's warning: Reading these commentaries may stimulate readers not only to “think outside the box” but to consider “stepping outside the box.” Timothy Chartier coaches readers to think of your business as a team and focus on finding coachable results where you may find a winning combination of insight in “Coachable Business Results.” Tom Pryor, a veteran advisor in all aspects of life, advises management accountants to raise their expectations in “Management Accounting's Bigotry of Low Expectations.” Issues may include additional topics such as Behavioral Management, Leadership, and Ethics; Supply Chain Management; Managerial Economics; Capital Markets and Financial Value Issues; Decision-Making; Styles, Approaches, and Experiences; Information Science and Utility; Governmental Impact on Business; Impact of “Cultural Tones” on Business; Tools Available to Accounting and Finance Personnel; and other emerging topical interests of readers. Trending topics are always welcome if they are timely and informative. Short commentaries, new ideas, and new topics are encouraged. Authors are encouraged to present their content with the readers in mind. Content should be easy to follow and comprehend with clarifications that support understanding without further searching by the reader. The following deadlines are provided as guidance for those who wish to submit potential articles to JCAF. Please be advised that the review process requires earlier initial submission dates in order for the review cycle to be completed by the final due dates. Respectfully, Jim Edwards Editor JCAF James B. Edwards, PhD, CPA, CMA, CIA, CMA, CGMA, CCA, CCP, is a Distinguished Professor Emeritus in the Darla Moore School of Business at the University of South Carolina. He has served as a corporate controller, partner in a CPA firm, vice president of a computer services firm, vice president of a computer software firm, and journal editor, as well as in management advisory services and corporate training.