Operational Landmines: What’s Hot in Today’s Operating Environment & the Accounting Changes

September 9, 20134:00 – 5:15 pm

Jeff Darlington, SVP & CFO AIG Commercial Asset FinanceShawn Halladay, Managing Director, The Alta GroupDeborah Reuben, Product Manager, LinedataCapitalStreamScott Thacker, CEO Ivory Consulting

Introductions

• Panelists– Jeff Darlington– Shawn Halladay– Deborah Reuben– Scott Thacker

• Today’s Format– Overview of Operational Landmines by the panelists– Audience breakout into four groups; each group moderated by one of

panelists– Select one of the two Operational Landmines moderated by the panelist– Brainstorm and discuss what it means to your organizations– Four group presentations

Schedule

Start End

Introduction of Panelists 4:00 4:05

Overview of Session Format 4:05 4:10

Eight Operational Landmines & Accounting Changes(2+ min each)

4:10 4:30

Breakout Groups (choose one of two moderated topics) 4:30 4:55

Four Group Presentations(5 min each)

4:55 5:15

Operational Landmines

• We selected eight categories1. Regulatory2. Credit3. HR4. Asset Management5. IT6. Legacy Mindset7. Pricing8. Accounting Rule Changes

Regulatory

• State Taxation– Nexus issues– Defunct cities and states looking for revenue– New fees, taxes and assessments

• Many new and ever-more complex regulations– Difficult to understand all of them and how they inter-relate– Compliance awareness– Staffing

Jeff is moderator

Credit

• Securing your position– Know your customer rules– Lien perfection

Jeff is moderator

Human Resources

• Succession Planning– Retention– Cross-training– Retention & Recovery– EEOC re: layoff’s– Economy is bouncing around: hire/layoff cycle

Shawn is moderator

Asset Management

• Residual/End of Term– Setting residual in rapidly moving technology market– Recovering the assets

• Asset movement by lessee– Risk of loss– Different tax issues in different jurisdictions

Shawn is moderator

IT

• Excel Worksheets– Work-arounds– SOX compliance

• Report Overload– What is really needed– Paper vs. electronic

• Inventory Tracking– Know what you have– Re-lease or sale at End of Term

Deb is moderator

Legacy Mindset

• Very quickly moving economy, technology, business practices, and customer expectations– Unwillingness to change– Inertia– Solving wrong problem entirely

• Innovation barriers– Lack of funding even with positive business case– Unable to measure benefits

• Growth– Top line vs. cost cutting

Deb is moderator

Pricing

• Legacy mindset– Pricing to spread over COF rather than risk based pricing

• Application of elasticity concepts– What will the lessee market bear

• Excel spreadsheets are error prone– Formula changes– Putting in wrong numbers

• Education around more complex pricing concepts

Scott is moderator

Accounting

• Many hidden costs– IT Modifications– Professional Fees– Temporary Help– Technical Accounting Education– Processes & Controls– Reporting– Staff Training– Financial Products

Scott is moderator

Breakouts

• Audience divides into four groups• One panelist per group• Select one of the two topics moderated by that

panelist• Each group reports to the full audience

Conclusion

• Final comments and feedback