Finance flash: the TOP-10 articles of week 5, 2017


Do you want to keep up to date with the latest developments in finance, but you are short of time? Don’t worry. CFO South Africa weekly collects 10 of the most important articles from international media for your convenience.

1. Human rights risks in the supply chain
Regulators, shareholders, and consumers increasingly expect companies to be aware of, and accountable for, what goes on throughout their supply chains. Here's what to look for when choosing a third-party supplier. Retailers and manufacturers sourcing from producers in emerging markets often learn that the approach to human rights and labour relations varies from country to country. Despite these local differences, regulators and stakeholders expect international standards to be upheld throughout the supply chain, and such third-party operations have come under increasing scrutiny in recent years.

2. Data As A Service: Cloud Computing's New Addition
In today's age, data drives all decisions. The era of business leaders making decisions based on instinct or intuition are long gone. Why take a risk when data can point you to the right solution? Instead of following a feeling, business choices are most often made by consumer behavior: how do they react to a particular A/B test? How do they navigate your website, and what do they pay attention to? What do they even use your product for?

3. Three Things Driving Entrepreneurial Growth in Africa
Fatigue may be setting in for some Western investors' interest in African innovation, particularly those that have yet to reap rewards to brag about. Even a star company like Nigeria's online retailer Jumia (known by some as the potential "African Amazon") is struggling to return profits to early investor Rocket Internet, of Germany. Why the downbeat mood? One reason we have observed is that while African entrepreneurship is thriving, few ventures are large enough for Western institutional investors. Another reason is that investors are myopically infatuated with snazzy technology.

4. Why corruption risk should be taken into account when evaluating ne...
Analysing corruption risk should be a key factor in businesses' research into a new market. Involvement in corruption, whether direct or via a third party, poses reputational risks as well as risk of prosecution under legislation such as the UK Bribery Act or US Foreign and Corrupt Practices Act (FCPA). Corruption remains widespread in many countries, and the latest edition of the corruption perceptions index from Transparency International suggests that the problem worsened in more markets than improved in 2016.

5. 5 strategies to efficiently implement the new lease accounting stan...
As mandated by regulators, Sealed Air is implementing the new lease accounting standard on schedule. The standard will take effect January 1st 2019 for public companies and one year later for private companies. Implementation requires public companies to restate 2017 and 2018 and private companies to restate 2019. Sealed Air started preparations in 2016 and will increase time and efforts this year to bring all leases onto the balance sheet. That means the multinational manufacturer of packaging material will be working harder on implementing the new lease accounting standard while efforts to implement the new revenue recognition standard are in full swing. It's a challenge many companies are facing in 2017.

6. Balance-Sheet Cash Likely to Rise, Not Fall, in 2017
Are corporations going to deploy a chunk of their cash reserves this year? The Association for Financial Professionals' Corporate Cash Indicators index seems to indicate they will. The quarterly survey of corporate treasury and finance professionals released Monday found that 30% of U.S. company respondents plan to reduce cash and short-term investment balances over the next three months, while 23% plan to expand those balances. That's a significant change from the October 2016 reading of the survey, in which the proportion of finance executives answering "expand" exceeded those responding "deploy" by four percentage points.

7. Apple's strategy in the 'smart home' race is threatened by Amazon
In less than a year, Amazon's combination of the Echo speaker system and the Alexa voice-controlled digital assistant has come close to delivering on the elusive promise of easy-to-use technology that can control gadgets in the home with a few spoken words. Yet Amazon's surprise success sets up a long-term battle with Apple Inc. and Alphabet's Google for primacy in the connected household. And the contours of that competition are following a classic tech industry dynamic.

8. Artificial Intelligence Comes to Financial Statement Audits
Artificial intelligence advocates speak of a time to come when these systems will be capable of auditing 100% of a company's financial transactions. These visionaries foresee the day when AI will enable auditing that is a continuous and real-time process, not a prolonged exercise requiring large teams of accountants working overtime after the close of a fiscal year. But is AI in auditing a good idea? Or do we even have a choice — is it just part of the data-focused technology wave that all companies must embrace?

9. The 9 Management Myths That Leadership Needs To Nix
The career landscape has been completely transformed over the past half century. The scenes in Mad Men seem absolutely impossible to imagine in today's world of work. Despite the huge contrast, several musty mindsets about employees and employers persist. In this post, I will focus on employer mindsets that need to be reset.

10. 10 strategies to successfully integrate a deal
Pip Spibey, ACMA, CGMA, has spent much of the past year integrating an acquisition that UK-based Travelport made to develop new digital services and mobile capabilities for the travel industry. In June 2016, Travelport, a technology platform that enables travel agencies, corporations, and travel providers to search, share, buy, and sell travel bookings, acquired an additional 40% of Locomote, an Australian start-up that helps companies manage business travel worldwide from any device. The investment increased Travelport's stake in Locomote to 96%, according to filings with the US Securities and Exchange Commission.

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