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Growing customer relationships to grow bank revenues

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By: Collier Wright, Product Manager, Sageworks In an increasingly competitive banking environment, community banks and local credit unions know relationships are the foundation of a growing portfolio. Nevertheless, repetitive data entry, tracking down documents and other paper-shuffling duties continue to eat up time needed to foster, grow and retain a…...

Three reasons bankers consider a CRM

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Managing a loan portfolio while handling the three-pronged goal of maintaining high-quality customer service, growing loans and prospecting is the difficult task asked of lenders. The work that goes into managing the portfolio can sometimes mean growth initiatives don’t get the attention they deserve. With the right customer relationship manager,…...

What is effective challenge?

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By Alison Trapp Senior Consultant, Sageworks Advisory Services Effective challenge is a framework for providing critical analysis, and it is a critical component of risk management for an institution, model or practice. Effective challenge involves utilizing objective, informed parties who can identify limitations and assumptions and who can produce appropriate…...

Bankers: Almost every part of the loan process takes too long

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From prospecting through post-closing, banks are faced with a network of interdepartmental systems to process a loan. For example, the lender secures the deal and manages the relationship, the credit analyst underwrites the loan and evaluates the risk, and the portfolio manager monitors ongoing administrative checkpoints. One could imagine a…...

How community banks can regain the small business lending market

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In today’s banking world, community banks are focused sharply on shareholders’ expectations for growth in earnings and return on equity. So, how can community banks support earnings and ROE growth in the face of intense regulatory scrutiny and competitive pressures on profitability? By leveraging their strengths in relationship lending and…...

Building data integration bridges

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Connecting Sageworks to Salesforce.com™ Communication is vital to nearly every aspect of our lives, so we continuously work on ways to improve it. This is why Sageworks introduced its API (application program interface) Network, an essential tool for communication between applications. APIs create a link between solutions for a streamlined…...

Expected lending practices in 2018 and a review of Q4

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In January, the Federal Reserve conducted its latest quarterly “Senior Loan Officer Opinion Survey on Bank Lending Practices”. They surveyed senior lending officers of 71 domestic banks on changes they have seen and anticipate in lending standards and commercial/consumer bank loan demand. The Fed survey found that regarding commercial loans,…...

Coaching clients to improve their enterprise value

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By Rich Greene, CEO - Director, Clarus Advisors Most entrepreneurs I have worked with are proud of the business they built and have not been afraid to take risks to “grow the business”. However, while most do an excellent job of managing the day-to-day challenges their businesses face – they do…...

Infographic: Closing deals with a defensible business value

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From the lack of proper documentation to a sudden change in the market, there are many reasons businesses fail to sell. One of the primary issues facing the sale of businesses is the valuation gap. A valuation gap is the difference between the owners perceived value and the actual market…...

Why is it so difficult for clients to discuss exit planning?

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By John F. Dini, CMBA, CExP, President, MPN Incorporated Understanding the Post-Ownership Void As advisors, we understand that our business clients should be preparing for the biggest financial event of their lives – the sale of their business. However, when we ask, “What is your plan for life after the business?,”…...

Expected accounting trends in 2018

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As technology continues to evolve, 2018 likely holds new trends and improvements for which to prepare your firm. In order to stay competitive in today’s marketplace, keeping up with new technologies is vital for maintaining relevance. Shown below are 4 trends to expect in 2018: Further Evolution of Technology Though…...

Client attraction: What to do in-house and what to outsource

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By Salim Omar, CPA, President, CPA Marketing Genius, LLC Many CPA’s that I talk to get overwhelmed and disillusioned by their marketing efforts. To be honest, prospects are feeling the same way. Most internet users report suffering from “information overload.” So where does that leave us? We do not want our…...

Cash management 101: Controlling & forecasting cash flows

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By Rich Greene, CEO - Director, Clarus Advisors Cash Management by definition is the process of maximizing cash flow and minimizing unproductive cash balances. Speedier collection of receivables and diligent disbursement of trade payables definitively creates more free cash for the company. However, without understanding the cash and liquidity requirements of…...

Infographic: 4 Reasons to leverage technology in your accounting firm

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Consultant Doug Sleeter, an Accounting Hall of Fame member, pointed out in 2014 that, “small and medium-sized businesses no longer simply require tax and compliance-related services. They need – and want – advisory services.” At this point it is no secret – businesses want their accountant to help their business…...

Cash management 101: 3 Ways to control payables and increase cash

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By Rich Greene, CEO - Director, Clarus Advisors We have seen that managing collections can dramatically increase cash flow. The same is equally true when managing your payables. While we look to speed our collections, we must carefully manage the payable process so as not to disrupt or jeopardize your vendor…...

Risk rating transition matrix for credit unions

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Credit unions seek to have a credit risk rating system that is both accurate and reliable. In the Commercial Risk Rating Considerations eBook, Sageworks Advisory Services Senior Consultant Alison Trapp describes some of the questions a credit union can ask to ensure their system is comprehensive, including the use of a risk rating…...

Understanding SSARS 21 can pave the way to more advisory services

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Firms of all sizes are making advisory services an important revenue stream, based on the latest National Management of an Accounting Practice (MAP) Survey from the AICPA Private Companies Practice Section (PCPS) and CPA.com. To better position themselves as providers of higher-level advisory services to their clients, accountants should develop expertise…...

There is no “I” in success

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By Salim Omar, CPA, President, CPA Marketing Genius, LLC There is no ‘I’ in ‘success’ but there is one in inspire, integrate and initiate. The day-to-day routine of coming to the office, typing away at the computer and eating the same chicken salad for lunch can become monotonous. This monotony can…...

Career paths after becoming an ABV

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By Rachel Flaskey, CPA, ABV, CFF, CGMA, Vice President, Chartwell So you recently achieved the ABV (Accredited in Business Valuation) designation through the AICPA…now what?  An efficient way to start in the valuation profession is to find a mentor who is willing to review your reports and provide introductions to…...

4 Risk rating applications for credit unions         

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Regulators expect that lending departments at credit unions not only assign risk ratings accurately and timely but also that they use them throughout risk management processes. In the Commercial Risk Rating Considerations eBook, Sageworks Advisory Services Senior Consultant Alison Trapp outlines five areas in which credit unions should consider using risk rating. 1.…...

Navigating 4 key CECL challenges for credit unions

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In a recent CUES article, Terry Katzur, CCE, EVP/chief lending officer of ELGA CU in Burton, MI, wrote about how their credit union plans to prepare for the current expected credit loss (CECL) transition. “Like many credit unions, we at ELGA Credit Union—with assets of $543 million in Burton, Mich.—currently…...

When CPAs need to justify pricing for advisory services

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By Bryce Sanders, President, Perceptive Business Solutions Inc. Ideal clients have complicated tax situations, but not enough time.  You help them, and they recognize your value.  Knowing that your client’s biggest asset is often their business, wealth management as a service offers the ability to cross sell to your clients. Yet,…...

Ready, set, grow your CPA practice

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By Salim Omar, CPA, President, CPA Marketing Genius, LLC A garden will only be as abundant as the nutrients that it receives. This is a similar ideology I hold in growing my practice. The nutrients for growing a practice are finding innovative ways to market services, appeal to existing clients and…...

Infographic: Tech drives growth in accounting firms

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A major concern for many firms is whether or not their technology investments will pan out. The big question is: “Will this expenditure return a profit for the firm?” This concern often leaves firms clinging to their previously purchased, outdated technologies and prevents them from reaching their greatest efficiencies. Because…...

Risk rating scorecards: 4 Key considerations for credit unions

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Some commercial lending organizations leverage a scorecard risk rating system that assigns values to different inputs and then weighs those factors to calculate a risk rating score. The NCUA does not require credit unions to use a scorecard; however, they recognize the value that they may provide to credit unions.…...

Infographic: Optimize business valuations in your firm

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Streamline the valuation process in your firm by focusing on these four areas of optimization: Maintain professional standards: Develop accurate workflow that follows industry best practices and provides quality valuations consistent with those provided by peers. One way to reduce risk while also saving time in performing valuations that meet industry…...

Credit unions: Determine risk ratings scale based on portfolio complexity

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When a credit union establishes its risk rating system it has to decide whether it will require analysts to separately rate the borrower (capacity) and the loan (facility) or to assign one rating that considers both factors together. Said another way, it has to decide between a dual or single…...

Transforming “lenders” into “bankers and advisors”: Developing the entire relationship

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During a recent Sageworks webinar, Nick Miller, president of Clarity Advantage shared best practices to transform lenders into advisors to their business clients. During the webinar Miller discussed that business borrowers want a full banker relationship, not just lenders. When business owners seek funding, they also want to form a…...

Infographic: Retaining clients by the numbers

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It is a well-known fact that retaining clients at accounting firms can be challenging. There are a couple statistical figures that can paint a helpful picture of the challenges preventing firms from retaining clients. One of the primary reasons firms are having a hard time retaining clients is because the…...

Best practices in risk rating policies

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Policies are “the cornerstones for sound lending and loan administration,” and risk rating policies are a key component. Regulatory agencies lay out elements that loan policies should cover, such as what types of loans an institution will make and what information will be required from borrowers, but they rarely dictate…...

Setting goals for exiting your business: Why it’s important

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By John Brown, Founder of Business Enterprise Institute, Inc. Setting goals is critically important when you approach the inevitable exit from your business. Without goals, even the strongest systems fail, as they have no purpose to work toward. Your goals are what guide your process toward a successful exit, and without…...

Regulators share proposed changes to HVCRE guidance

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During a Sageworks webinar on HVCRE risk management Rob Ashbaugh, senior risk management consultant at Sageworks, explained that clarifications on some of the murkier aspects of the HVCRE (high volatility commercial real estate) rule were anticipated by the industry. On September 27, the Board of Governors of the Federal Reserve…...

4 Ways to improve the typical lending dysfunction

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Ancin Cooley, CIA, CISA, of Synergy Bank and Credit Union Consulting, recently presented at the 2017 Sageworks Risk Management Summit on the Perspectives of Lending Dysfunction: Loan Officers, Credit Analysts and Loan Reviewers. According to Cooley, the major cause of dysfunction between the lending department and credit risk function is…...

4 Strategies to keep up with tech changes

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As technology continues to evolve, it is difficult for every team member to keep up. Employers can help by implementing strategies to ensure that employees are proficient in and knowledgeable of new industry tech. The below strategies will guide a firm’s development of well-informed, proficient employees.  1. Where do your…...

The role of expert judgment in risk rating

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This post is authored by Alison Trapp, senior consultant at Sageworks. Imagine the following scenario. An analyst is preparing a risk rating as part of an account’s annual review. She has spread the most recent financial data and updated answers to qualitative questions in the scorecard. She knows this credit…...

How long does it take to close a commercial loan?

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Banks have a wealth of information available to them, and if they use the right tools to dissect that information, they can make major process changes that improve what matters most to customers – both customers of today and tomorrow. For example, according to a recent poll during the Sageworks…...

Evaluating single vs. dual rating systems

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This post was authored by Alison Trapp, senior consultant at Sageworks. When a lending institution establishes its risk rating system it has to decide whether it will require analysts to risk rate the borrower or the loan -- or both. Said another way, it has to decide between a single…...

Infographic: Is your firm future ready?

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With 90 percent of accounting firms acknowledging that the digital future is rapidly approaching, it is crucial that firms prepare themselves for the collision of trends that will drive the future of the industry. A fast future of new competitive advantages that will drive productivity and progress in the industry…...

Three considerations for including industry in risk rating

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This post was authored by Alison Trapp, senior consultant at Sageworks. Credit analysts assign risk ratings with a focus on whether the lending institution will get its money back in full and on time. This forward view is the reason analysts will downgrade on expectations and upgrade on performance. Borrowers…...

ProfitCents is accountants’ “User Favorite” for business intelligence

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ProfitCents, the Sageworks solution that helps accountants easily translate financial statements into actionable insights for client businesses, has been recognized by Accountex USA as the “User Favorite” for business intelligence. Accountex USA, the only independent accounting technology expo and conference in the U.S., announced the award this week in Boston…...

Cash management 101: 5 Ways to improve collections

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By Richard Greene, Clarus Advisors Cash flow is the life’s blood of a business. This is true for the small business and the Fortune 50. Understanding, tracking and controlling your company’s cash inflows and outflows is paramount to running a healthy company. To illustrate the impact collections has on your…...

The first step in a practical 2017-2018 credit union action plan – Build a CECL committee

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In the recent Sageworks webinar Actionable Steps to Prepare for CECL Today, Neekis Hammond and Jared Mills of Sageworks discuss five actionable steps credit unions can take to prepare for the upcoming CECL regulation. Coordinate departments The first step describes the importance of coordinating with other departments to form a…...

What borrowers want – Bringing value to the member relationship

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In a world filled with digital loan applications, growing fintechs and booming small businesses, credit unions need to continually evaluate their borrower experience. In a recent Sageworks webinar, “Best Practices for Automating Simple Member Business Relationships,” Vice President of Strategy at Sageworks Peter Brown discusses ways to improve borrower satisfaction.…...

Cash flow and quality of earnings

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By John F. Dini, CMBA, CExP Financial buyers, Private Equity Groups and Family Offices, acquire companies based on their Return on Investment (ROI). When the owner of a mid-market company receives an offer from a financial buyer, he or she logically expects detailed due diligence on the business’ assets and…...

Best practices when choosing risk rating factors

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This post was authored by Alison Trapp, senior consultant at Sageworks. Risk rating matrices, also called scorecards or templates, serve an important purpose for the commercial lender: they drive consistent risk ratings. The regulatory agencies do not prescribe what a risk rating system should look like at a given institution.…...

Infographic: Why accounting firms need value added services

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There are several reasons why an accounting firm should consider developing and selling advisory services. Most notably, firms can increase their client retention up to 98 percent by providing 5 or more services to their clients. If clients are able to use a firm as a one-stop shop for all…...

Infographic: How will your firm grow?

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Most partners or valuation professionals are constantly asking themselves this question: How will our firm grow?  According to an April 2017 Sageworks webinar poll, 41 percent of attendees selected the top challenge for valuation practices is attracting new clients signifying the biggest challenge for the 275 valuation professionals. With the average, unexpected…...

Business valuations: When speculation becomes fact

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By John F. Dini, CMBA, CExP As an exit planner, I hear lots of owners opine about the value of their company. Some are well informed, but more often than not, they don’t have the full picture. When asked about their reasons for the value they think their business has,…...

How do credit unions ensure CECL data adequacy?

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“When considering member business lending and the consumer portfolio where many credit unions focus, change management to prepare for CECL can be even more difficult with a credit union,” says Danny Sharman, risk management consultant at Sageworks during a recent CECL webinar – Data Quality for Credit Unions. “The first…...

CECL model: Build or buy?

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Compared to existing ALLL requirements, Accounting Standards Update 2016-13 (CECL) will require more inputs, assumptions, analysis and documentation, making the option to automate the process significantly more attractive for many institutions. Regardless of an institution’s approach, key consideration areas for a CECL-ready model include data management, contractual life, segmentation, methodologies,…...

Leveraging digital channels & capabilities for revenue growth

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A recent Sageworks whitepaper on loan growth addresses how banks and credit unions can leverage digital channels to grow the loan portfolio and remain competitive with the emerging trend of alt-lenders in the small business lending space. The banking industry has historically been able to play defense against newcomers because…...

Stress testing revisited to avert risk and improve risk ratings

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There is a wealth of information made available by regulatory agencies and consultants around which types of loan portfolio stress testing methods should be used by financial institutions. Two ways in which stress testing results can be used to an institution's advantage is to avert risk and improve the risk…...

Error-free work – Is it time to move past the spreadsheet?

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What do we do with all of these spreadsheets?  The above question is being asked by financial managers at banks and credit unions as the implementation of the FASB’s current expected credit loss model (CECL) approaches. So, where did the use of all of these spreadsheets (and the dependence on…...

Are de novos making a comeback?

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The FDIC paper The Entry, Performance, and Risk Profile of De Novo Banks  published in April 2016 reports that the number of de novo bank failures and acquisitions annually has drastically declined since 2010, primarily due to the fact that new bank formations have become nearly inexistent. Cheryl Monk, a…...

Data quality for credit unions – 3 Methods for data collection

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In order to prepare for FASB’s Current Expected Credit Loss (CECL) model, credit unions are currently relying on different methods to collect and store data. In the recent CECL Webinar: Data Quality for Credit Unions, Sageworks Risk Management Consultant Danny Sharman discusses the three different types of methodologies for data…...

Credit union webinar – CECL data quality

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In a recent webinar for credit union executives, Danny Sharman a risk management consultant with Sageworks addressed loan data for these institutions, especially as they look toward the currect expected credit loss model (CECL) that will be required for the allowance for loan and lease losses (ALLL). The webinar covered…...

Get your ducks in a row: HVCRE risk management

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In a recent Sageworks webinar Robert Ashbaugh, senior risk management consultant at Sageworks, discusses High Volatility Commercial Real Estate (HVCRE) lending best practices. How did we get here? Ashbaugh’s presentation begins with a quick summary of why regulators care about HVCRE. He starts by reviewing some of the data over…...

Strategies for improving your firm’s cash flow management

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The health and performance of your firm is determined by the volume and direction of your cash flow. The state of your cash flow can determine the future growth of the firm and impact the firm’s investment decisions. Selecting established and refined methods for cash flow management can be the…...

AAR annual risk software report recognizes Sageworks

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Allaboutrisk.com (AAR) recognizes Sageworks as a credit risk vendor in its 2017 Risk Software Report. AAR is the global leader for online news, product and innovation information on risk, compliance, and trading. The 10th annual report features 60 leading risk software vendors and consultants from around the world and across…...

Pitfalls of OCR

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For banks and credit unions, keying data into digital spreads - whether its spreadsheets or a specialized credit software - can be a tedious hurdle. Bankers seeking to automate data entry have a few software options on the market, and one that has been talked about for a long time…...

4 Time-saving strategies for you and your firm

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We’ve all heard it: Time is money.  This proves true in the accounting industry as much as any other. While it is great to be busy, it can be a sign that you need to re-evaluate your day-to-day work for areas that can be streamlined. Evaluation can be most needed…...

7 Key considerations to establish policy and grow the MBL portfolio

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The NCUA’s new member business lending (MBL) rule has opened the doors for credit unions to grow their loan portfolios. Endeavoring  into member business lending requires a sound strategy that balances inherent risk with perceived opportunity. The first step to outlining a successful MBL strategy requires establishing policies that provide…...

Why business owners don’t buy coaching from their accountant

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In a recent Sageworks webinar, “Why Business Owners Don’t Buy Coaching From Their Accountant (And What To Do About It),” John Warrillow, author of “Built to Sell: Turn Your Business into One You Can Sell,” discussed a major hurdle for accounting firms that are making the transition from compliance work…...

Registration deadline approaching – Risk management summit 2017

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One month before the primary registration period ends. Register now and save $100 per registration. The 2017 Risk Management Summit presented by Sageworks is set for September 25-27th in Denver, CO. The Summit is the industry’s leading life-of-loan conference, spanning loan origination through portfolio risk management in a CECL -…...

Are you ready? Increasing regulation for small business lenders

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In December of 2016, the Consumer Financial Protection Bureau’s associate directors of the Office of Fair Lending expressed a new shift in priorities that will increase focus on small business lending, among other loan types.  A group of bankers from the Tennessee Bankers Association met with representatives of the CFPB…...

Infographic: Growing baby boomer demand for valuation services

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Inform your firm's strategy by quantifying the size of the business opportunity for valuation professionals as more and more baby boomers seek to sell their businesses in the coming years. As retirement is the #1 driver of small business sales, the financial opportunity to service baby boomers is an undeniable…...

2017 Risk Management Summit – Join Sageworks in Denver!

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The 2017 Risk Management Summit presented by Sageworks is heading to the "Mile High City". The conference features consultative presentations, panels and peer discussions on topics related to the full life-of-the-loan.  Why You Should Join Us The Summit offers actionable insights that apply across the whole institution, spanning business development…...

Credit union FAQs: Implementing the new MBL rule

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It’s been more than six months since the National Credit Union Administration (NCUA) issued its revised member business lending (MBL) rule in January 2017. Among other things, the new MBL rule further defines the difference between commercial and member business loans and states that non-member loans do not count toward…...

Small U.S. accounting firms and their consultative future

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While the Big 4 firms often receive the majority of coverage and attention in the accounting industry, they are far from representative of the average firm in the U.S. In fact, 90% of all accounting firms have 10 or fewer collective partners or owners (AFOT). By 2024, sector growth of…...

The most asked questions on global cash flow analysis: passive v. non-passive income/loss

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During a recent Sageworks webinar, Linda Keith, CPA, covered the top questions she gets from bankers on k-1’s, pass-throughs and global cash flow analysis. Keith collected data from her website, where articles answering these questions collectively received over 66,700 views. Keith’s most viewed article on her site, with over 21,400…...

How to find data adequacy ahead of CECL

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FASB's guidance for estimating expected credit losses is not prescriptive, so, examiners are not asking exactly how you plan to calculate your reserve under CECL today. However, due to the shift from an incurred to expected loss model, banks need to be working on loan-level data collection now as a…...

5 Cash flow management best practices for business owners

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By Alison Nailor, Sageworks As a business owner, you understand it’s important to be aware of your company’s cash flow and manage it well. In the rush of day to day business management, however, this can be difficult. According to a recent Crowe Horwath survey of manufacturing companies and distributors,…...

Business Cash Flow Statement

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What it is and why it’s important to small business owners. Definition A Cash Flow Statement is a financial report that details the amount of cash and cash equivalents that enter and exit a company over a specified time period. The Cash Flow Statement is broken up into operating, investing…...

Have you fed the alligator? Assessing your credit union’s risk appetite

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Would you swim across a pool with an alligator for $1 million?  Some people may say yes, some no. Some may ask – has the alligator been fed? How big is the alligator? How big is the pool? Successful strategic plans require goals that are determined through risk identification and…...

How to run quarterly roundups and use balance business scorecards at your firm

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By Rich Greene, CEO - Director, Clarus Advisors The great Yankee catcher Yogi Berra once said, “If you don’t know where you’re going, you might not get there.”  I am confident that your clients have strategic plans, business plans and budgets. I am also confident they are keenly aware of…...

4 Ways to earn CPE credits in North Carolina

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  All CPAs are required to complete Continuing Professional Education (CPE) credits in order to maintain their professional competence and provide quality accounting services. Considering that tax laws and regulations are constantly changing, earning CPE credits and continuing to gain expertise is a must. This article addresses current CPE rules…...

Fintech partnerships: A competitive advantage

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Many banks and credit unions have found a path to growth via partnerships with fintechs. For some financial institutions, partnering with software providers has helped them maintain a competitive advantage. Technology partners offer much more than just software to banks; a fintech partnership provides delivery channels, convenience, corporate governance, advisory…...

Loan review – A crucial component of risk management

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A recent whitepaper from CEIS Review, Independent Loan Review – An Essential Tool, discusses why banks and credit unions should be sure to conduct regular reviews of their loan portfolio: “the fundamental purpose of the program is to monitor the risk and administration of an institution’s largest financial asset—the loan…...

Managing member business lending risk

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It’s been five months since the new member business lending (MBL) rule from the NCUA went into effect in January, providing greater flexibility to credit unions offering member business loans. “Credit unions that focus on business lending are generally healthier than the average credit union,” says Tom Glatt, Principal of…...

How to improve the weakest points of your client relationships

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The critical factors clients seek in today’s firm are expertise, communication and the proactive supply of business enhancing advice. The performance on these three categories will set individual advising firms apart from their competition.  As data becomes a more integral part of analysis in today’s technologically savvy world, it becomes…...

Helping credit unions grow organically: Proper software implementation & integration

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In a recent article from Credit Union Insights, Frank Koechlein discusses the need for credit unions to grow into their analytical solutions. “When you were in college you didn’t start with advanced trigonometry, you started with the basics of math and each year you built on what you learned the…...

Hiring headache? Try technology

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One of the biggest obstacles for many community banks and credit unions with aggressive growth goals is staffing. As the institution grows there is more for everyone to do, and additional staff is often necessary to keep up. However, growing the staff can be a real challenges for many banks…...

Sageworks Lending Solution helping community banks and credit unions grow

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Earlier this month, John Holt, CEO of Nutmeg State Financial Credit Union appeared on Better Connecticut to discuss how Nutmeg FCU was fulfilling its commitment to helping small businesses in their community by implementing a new digital loan application process. John commented that most banks and credit unions do not…...

5 Benefits of expanding in-house member business lending

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With the National Credit Union Administration issuing its final member business lending (MBL) ruling as of January 2017, credit unions are seeing increased flexibility in their lending limits. While this newly found flexibility provides opportunities for competitive growth, the NCUA states “[MBL] has unique characteristics and more complex variables than…...

CECL: The role of risk ratings

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The importance of a sound risk rating process continues and possibly grows in the coming years as financial institutions grapple with the increased emphasis on estimating credit losses. With Basel III focusing more attention on credit risk management, and the more granular review of loans required by the FASB’s current…...

Infographic: 3 factors influencing success in business valuation firms

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Success in business valuation practices is driven by many factors, but three have shown to be key components for growing firms, according to market research firm IBISWorld. The first is developing specialized services that provide a competitive advantage. Specialized knowledge and experience allow a more effective, targeted valuation practice, which…...

Best practices for stress testing the commercial real estate portfolio

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Stress testing programs should consider their tests in a one-year time horizon measured in both a mild and severe scenario. Mild scenarios should test items to where they honestly think they will be in one year. Severe scenarios should try and replicate conditions that represent the worst possible outcome for…...

Are alt-lenders catching up to banks on borrower experience?

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In a recent Sageworks webinar with David O’Connell from Aite Group on the small business borrower experience, David presented data from an Aite survey of small business borrowers. One of the most fascinating insights from the data was how closely alternative lenders are nipping at the heels of banks when…...

In a sea of tech companies, Sageworks rises to top award

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Over the past few years, the Research Triangle area of North Carolina, where Sageworks is headquartered, has been named among the fastest-growing cities in the U.S., the best places to live, the top boomtowns and the best places to start a business (among many other accolades). It’s also home to…...

The most useful (and rarely used) types of data analytics

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By Jackie McLaughlin, CPA Data analytics are gaining momentum as they are increasingly being used during the audit process. As auditors know, data analytics are required during both the beginning and the end of an audit. However, analytics can also be employed efficiently and effectively as substantive procedures. Data analytics…...

Stress testing programs – Multifamily

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Stress testing programs should consider their tests in a one-year time horizon measured in both a mild and severe scenario.  Mild scenarios should test items to where they honestly think they will be in one year.  Severe scenarios should try and replicate conditions that represent the worst possible outcome for…...

Business Financial Metrics

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What they are and why they are important to small business owners. Definition Financial Metrics are the key performance indicators for a business. These include Accounts Payable Days, Accounts Receivable Days, Net Profit Margin, Overhead Growth, Sales Growth and Inventory Days among others. Try our free cash flow solution, CashSage…...

SBA Chief: Writing YOUR Success Story

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Guest post by Linda McMahon, SBA Administrator Once upon a time…. It’s the classic opening to our favorite fairy tales. As children we dream of magic potions and knights in shining armor that will provide our happily ever after. How were we to know that our own hard work, skill…...

Where To Start: Stress-testing commercial real estate portfolios

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Stress testing, especially for community banks, can be challenging because of the lack of specific methodologies and practices recommended by regulators. This gap exists, in part, to allow banks to come up with their own unique program that shows regulators that they can identify and manage those risk, which is…...

4 key characteristics of the modern SMB borrower

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During a recent webinar with Sageworks, David O’Connell, a Senior Analyst at Aite Group, presented data from a recent survey by Aite of small and medium business borrowers. Included in this data were some key insights into the small business borrower. 1. They apply early… The Aite survey data first looked…...

Business Cash Flow Analysis

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What it is and why it’s important to small business owners. Definition Cash Flow Analysis is an examination of a company’s incoming and outgoing cash during a specific period and is often used for financial reporting purposes. The analysis begins with a starting balance and generates an ending balance after…...

What are analytical procedures and their benefits?

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By Jackie McLaughlin, CPA Analytical procedures are beginning to become more prevalent in the audit world. They provide auditors with many benefits. But are those benefits known? According to the AICPA, analytical procedures consist of reviewing financial information by studying plausible relationships between data and evaluating it for consistency. Analytics…...

CECL Q&A – PD/LGD & discounted cash flow

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The FASBs Current Expected Credit Loss (CECL) model presents unique challenges for banking professionals. To help institutions prepare, Sageworks launched a CECL webinar series covering data, segmentation, methodology and forecasting requirements broken down by loan type. A key component of the series is allowing participants to ask their CECL-related questions…...

Costs and risks with manual data entry

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In the past couple of years, the lack of technology or automated processes for loan origination at banks and credit unions has been under an increasingly bright spotlight. As fintechs become an increasingly viable option for loans to consumers and small businesses, banks and credit unions will have to find…...

One of commercial banking’s biggest challenges solved by Sageworks’ “Most Innovative” product

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Experts agree that while commercial lending is a critical banking service, it has been one of the least automated and technology-reliant aspects of banking today. One of the reasons for the current inefficiency in commercial banking is the number of tax returns that need to be entered and analyzed by…...

CECL Q&A – Methodology

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The FASBs Current Expected Credit Loss (CECL) model presents unique challenges for banking professionals. To help institutions prepare, Sageworks has launched a CECL webinar series covering data, segmentation, methodology and forecasting requirements broken down by loan type. A key component of the series is allowing participants to ask their CECL-related…...

The current landscape for MBL regulation

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In a recent Sageworks webinar, Ancin Cooley of Synergy Credit Union Consulting took a deep dive into five areas that credit unions interested in growing their MBL portfolios need to be aware of in order to effectively manage risk in the MBL portfolio. The first module that Ancin covered during…...

Poll: Top challenge of valuation practices is attracting new clients

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During a recent webinar, titled Calculation v. Valuation How Each Fits in Your Practice, Sageworks polled 275 valuation professionals and found that more than 41 percent recognize their biggest challenge as attracting new clients. In fact, attracting clients topped other challenges, such as “accuracy in valuations” and “not enough time,”…...

CECL Q&A – Segmentation

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The FASBs Current Expected Credit Loss (CECL) model presents unique challenges for banking professionals. Even though the full effects of the guidance are still years away from being felt, industry experts have been adamant that financial institutions better have begun preparing before now. To help institutions prepare, Sageworks has launched…...

Benchmarking

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What it is and why it’s important to small business owners. Definition Benchmarking is the process of using various financial metrics to evaluate the performance of a business against its competitors in an industry. Try our free cash flow solution, CashSage How it is Used Companies from different industries use…...

Sageworks user groups: Why attend?

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Sageworks User Groups provide an increasingly rare opportunity to be in a room full of peers, industry experts and staff from a critical vendor. The intersection of these groups allows for three distinct and valuable learning experiences. The quality of these face-to-face interactions at User Groups is impossible to replicate…...

How to increase efficiency and minimize risk in the audit process using analytics

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Jackie McLaughlin, CPA, started her career in a Big 4 public accounting firm. Since leaving public accounting, she has been an internal auditor, a tax preparer and a controller. She's also done forensic accounting and has written extensively on the accounting field. Currently, in addition to serving as the controller…...

The Number 1 reason you need to check-in on your risk ratings

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In order to effectively manage credit risk, banks and credit unions need to be vigilant at all stages of the life of a loan, from origination to administration to portfolio risk management. The easiest way to do this is via a robust risk rating system. By assigning a single rating…...

Technology-enabled data analytics: Friend or Foe?

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By Jackie McLaughlin, CPA With the increased availability of useful data, analytical review procedures are becoming more important during the audit process. The processes provide a number of benefits to help CPAs reduce risk and increase audit efficiency. Additionally they provide opportunities for CPAs to become even better at what…...

Business Sales Growth

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What it is, how it’s calculated and why it’s important to small business owners. Calculation Sales Growth = ((Current Annual Total Sales - Previous Annual Total Sales) ÷ Previous Annual Total Sales) × 100 Definition Sales Growth, also known as Revenue Growth, is the percentage by which the average sales…...

5 “Check ups” for your risk rating process

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A robust risk rating system is a crucial component of any financial institution's credit risk management process. Risk ratings are multi-purpose, useful in pricing loans, stress testing the portfolio or individual customers and determining appropriate reserve for the allowance. As an important component in your risk management strategy, it's smart…...

CECL Q&A – Contractual life

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The FASBs Current Expected Credit Loss (CECL) model presents unique challenges for banking professionals. Even though the full effects of the guidance are still years away from being felt, industry experts have been adamant that financial institutions begin their preparations today.  To help institutions prepare, Sageworks has launched a CECL…...

Banks and CDFIs: Partnering for community impact

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Guest Post By Paige Chapel, President & CEO, Aeris Most banks recognize that their enterprises can only thrive if their customers also do. And to thrive, those customers need economically diverse and healthy communities in which to live and work. Partnering with local organizations to promote the health of those…...

3 Ways to calculate the DSCR

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The Debt Service Coverage Ratio (DSCR) is an important measure in understanding a borrower’s ability to make payments on their current debt, as well as potential additional debt, so mastering this calculation is crucial to lending decisions. There are several ways to calculate this ratio, so familiarize yourself with the…...

Business Accounts Receivable Days

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What it is, how it’s calculated, and why it’s important to small business owners. Calculation Accounts Receivable Days = (Accounts Receivable ÷ Annual Revenue) × 365 Days Definition Accounts Receivable Days is the number of days until a company gets paid for its products or services. It is calculated by…...

Becoming an inspiring and profitable advisory accountant

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Best-selling author Steve Pipe is a Chartered Accountant, researcher, speaker and founder of Accountants Changing the World. He authored books including The World's Most Inspiring Accountants, The UK's Best Accountancy Practices and Your Blueprint for a Better Accountancy Practice, and is currently researching his 2017 book, The World's Best Accountancy Practices.…...

4 Strategies to grow the SMB lending portfolio

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During a recent Sageworks webinar, bankers were asked why they were interested in growing their small business lending portfolio. 38 percent answered that they were seeing increased demand in the market for SMB loans, and 23 percent responded that their existing small business customers were asking for loans. These results…...

Business Income Statement

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What it is and why it’s important to small business owners. Definition An Income Statement is a statement that reflects a company’s financial performance over the course of an accounting period. It lists the revenues and expenses and then calculates the net profit or loss. The Income Statement is split…...

CECL Q&A – data

Sageworks
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The FASBs Current Expected Credit Loss (CECL) model presents unique challenges for banking professionals. Even though the full effects of the guidance are still years away from being felt, industry experts have been adamant that financial institutions begin their preparations today.  To help institutions prepare, Sageworks has launched a CECL…...

The two biggest challenges public accountants face

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By Jackie McLaughlin, CPA Two of the biggest challenges that partners face when undertaking an audit engagement is risk mitigation and efficiency. Without proper risk mitigation a firm may issue an incorrect audit opinion and without audit efficiency, a firm may not be able to achieve healthy profit margins.  …...

Business Net Profit Margin

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What it is, how it’s calculated and why it’s important to small business owners. Calculation Net Profit Margin = (Net Profit ÷ Total Revenue) x 100 Net Profit = Total Revenue - Total Expenses Definition Net Profit Margin is the percentage of Total Revenue that translates into a profit for…...

Member and customer service is now defined digitally

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By Mark Arnold, president, On the Mark Strategies In the “good old days” of financial services (about 10-15 years ago, given the speed of technological advancement) the way banks and credit unions served consumers was defined more or less in terms of personal interaction. The majority of people still visited…...

Managing risk in MBL: Best practices and comprehensive strategies for credit risk management

Sageworks
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The NCUA passed a new MBL rule, effective January 1st of this year. This is part of larger efforts to expand credit unions’ ability to expand their commercial lending portfolios. As a recent Sageworks blog post on the new MBL rule explains,“one key aspect of the new rule is the…...

CECL methodology – vintage analysis application

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The FASB’s guidance on the Current Expected Credit Loss (CECL) model is not prescriptive and allows for a number of methodologies to be used in order to fulfill the requirements. Vintage analysis is an allowance for loan lease losses (ALLL) calculation methodology that has been suggested as being the new minimum…...

5 Effective steps to retain your best clients

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An obvious determining factor for the continued success of a valuation practice is the retention of its clients. Since customers are not contractually bound, there is an ever-present chance they may leave. In a recent study by 24/7, 47 percent of customers would reportedly choose a competing service provider within…...

How to excite your client with numbers

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By Rich Greene, CEO - Director, Clarus Advisors Finance and accounting are languages, languages of numbers, they speak to you, and you can see financial challenges looming for your clients through those numbers. But when you start a conversation with someone who doesn’t understand the language, they tune out. Quick…...

Understanding FAS-114 Loans

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The Financial Accounting Standards Board (FASB) provides certain guidelines, defining when to classify loans into FAS 5 (unimpaired loans) or FAS 114 (impaired loans) status. Evaluating FAS 114 (ASC 310-10-35), also known as Accounting Standards Codification Subtopic 310-10, loans for impairment and identifying the reserve for each one of those…...

6 realities for banks about lending to small businesses

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By Eric Baxley, Chief Marketing Officer, Sageworks Since my last post, I’ve continued to meet with our banks and credit union clients across the country, and some common themes surfaced in the conversations. Most notably, the institutions recognized that change was overdue for their business lending programs. 1. Bank management…...

Developing an MBL strategy

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Since the new MBL rule from the NCUA went into effect in January, many credit unions are considering member business lending as a growth strategy. As discussed in a Sageworks whitepaper, “Mitigating Top Member Business Lending Risks”, developing a strategy is key to successful MBL growth. Whether you are developing…...

CECL methodology – introduction to vintage analysis

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Under the Current Expected Credit Loss (CECL) model, there will be no triggers, thresholds or smoothing mechanisms allowed in loss calculations; the shift here is a movement to recording losses as they become expected. If a loss is expected, it should be recorded when that loss becomes known, even if this…...

Business Overhead Costs

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What it is and why it’s important to small business owners. Definition Overhead Costs are the indirect costs or fixed expenses of operating a business that range from rent to administrative costs to marketing costs. Overhead refers to the sum of all non-labor expenses required to operate a business. Try…...

Building a better small business borrowing experience

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Small businesses are an important market for growth-oriented banks and credit unions. The good news for financial institutions that see SMB lending as a crucial part of their loan portfolio growth strategy is that small businesses are in need of capital. In a recent Sageworks webinar, Steven Martin, vice president…...

Business Accounts Payable Days

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What it is, how it’s calculated and why it’s important to small business owners. Calculation Accounts Payable Days = (Accounts Payable ÷ Cost of Goods Sold) × 365 Days Definition Accounts Payable Days is the amount of days until a business pays its suppliers and employees. It is calculated by…...

Business Inventory Days

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What it is, how it’s calculated and why it’s important to small business owners. Calculation Inventory Days = Inventory ÷ Cost of Goods Sold * 365 Cost of Goods Sold = Beginning Inventory + Purchases - Ending Inventory Definition Inventory Days represents how many days inventory is on hold. To…...

Help clients boost enterprise value by building collaborative decision-making

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By Rich Greene, CEO - Director, Clarus Advisors How a company interacts internally to overcome obstacles is a key to building and expanding the enterprise value of the organization. Is there an inclusive process to review, anticipate and plan for changes and disruptions in the business and marketplace? Or a…...

Member business lending: The new rule

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In an increasingly competitive banking environment, many banks and credit unions are re-evaluating their lending portfolios to see where they might have strong opportunities for competitive growth. For many, that area is Small to Medium Business Lending and Commercial Real Estate. For credit unions specifically, this is an area both…...

The ALLL Today – pooled impaired challenges

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With the 2016 release of the Financial Accounting Standards Board’s (FASB) guidance on the CECL model, banking professionals and consultants have been theorizing about the impact the standard will have on current bank processes. While it is important for these banking professionals to be prepared, consultants are stressing the importance of…...

The ALLL today – impaired loan challenges

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With the 2016 release of the Financial Accounting Standards Board’s (FASB) guidance on the Current Expected Credit Loss (CECL model), banking professionals and consultants have been theorizing about the impact the standard will have on current bank processes. While it is important for these banking professionals to be prepared, consultants…...

The ALLL today – quantitative challenges

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With the 2016 release of the Financial Accounting Standards Board’s (FASB) guidance on the CECL model, banking professionals and consultants have been theorizing about the impact the standard will have on current bank processes. While it is important for these banking professionals to be prepared, consultants are stressing the importance…...

Business Balance Sheet

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What it is, how it’s calculated and why it’s important to small business owners. Definition A Balance Sheet reflects an organization's assets, liabilities and capital at a particular point in time. The total number of assets must equal the sum of liabilities and shareholders’ equity. Asset: a resource that an…...

Customer road trip: 6 Lessons learned about small business lending

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By Eric Baxley, Chief Marketing Officer, Sageworks I visited 20 customers (banks and credit unions) across the U.S. in the past few months and have learned six things that are common to almost all of them. They want to: 1. Grow their loans, focusing on small business lending with a…...

8 fundamentals for increasing the value of your client’s business

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As a business owner it is easy to get stuck in the weeds. The day-to-day commitments that a business deals with can prevent owners from thinking about the big picture. This reality is what hinders many companies from developing long-term plans for how to grow the value of their business.…...

Marc Rosenberg’s advice on partner retirement and buyout plans

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In a recent Sageworks webinar, 29 Must Haves for a CPA Firm Buyout Plan, Marc Rosenberg, CPA and President of The Rosenberg Associates, covered what it takes to develop a comprehensive, well-written, competitive partner buyout agreement. Rosenberg began by explaining that succession planning and partner retirement are arguably the most…...

5 Reasons to expand small business lending

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In the 2015 Growth Strategy Survey by Bank Director, the most commonly cited areas for growth were Commercial Real Estate Lending, C&I loans, SBA loans, and Construction loans. This trend of focusing on commercial lending for portfolio growth seems to be gaining, as reflected in a 2016 poll by Sageworks…...

3 Inefficiencies in loan origination and how to solve them

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As community banks and credit unions look toward 2017, many will be focusing on small business lending for loan portfolio growth, according to a recent Sageworks poll. However, small business lending comes with some  unique challenges that banks and credit unions will need to address in order to grow their…...

The ALLL today – Qualitative factor challenges

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With the recent release of the Financial Accounting Standards Board’s (FASB) guidance on the CECL model, banking professionals and consultants have been theorizing about the impact the standard will have on current bank processes. While it is important for these banking professionals to be prepared, consultants are stressing the importance…...

Business Bottom Line

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What it is, how it’s calculated, and why it’s important to small business owners Calculation Total Revenue - Total Expenses = Bottom Line Definition Bottom Line refers to a company’s net income. The term stems from its location on the Income Statement, where it falls on the last line. Bottom…...

Important considerations when growing the CRE portfolio

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In a survey of community banks and credit unions at the 2016 Sageworks Risk Management Summit, 42 percent of respondents said Commercial Real Estate, or CRE, lending was their primary focus for loan portfolio growth. This reflects a larger industry trend. As noted in a recent American Banker article, many…...

Tips to Prepare Your Client’s Business for Sale

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The following is written by Mary Beth Koester, Manager of Business Valuations at Rea & Associates. As you prepare clients for an exit, there are a few key areas and metrics to consider. Keeping in mind that exit planning can, and should, begin years in advance, you will be able to…...

Loan decisioning technology’s role in small business lending

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Many community banks and credit unions are turning to small business loans as a source of loan growth. In their Spring 2016 Semiannual Risk Perspective, regulators have publicly acknowledged increasing risk in commercial real estate lending, so small business lending seems like it may be an alternative path. Since small…...

The ALLL today – segmentation challenges

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With the release of the Financial Accounting Standards Board’s (FASB) guidance on the CECL model, banking professionals and consultants have been theorizing about the impact the standard will have on current bank processes. While it is important for these banking professionals to be prepared, consultants are stressing the importance of…...

Leveraging relationships: How community banks can win

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Some of the most pressing challenges facing community banks and credit unions in the current banking environment include narrow interest rate margins, increasing pressure from regulators, and competition.  One area where small community banks and credit unions have maintained an edge is in relationship lending. The bankers at community institutions…...

Position your accounting firm as a place to grow businesses

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Whether you are performing managerial accounting, financial accounting or tax accounting, your firm can grow by exploring other services that you may be able to provide for each client. If your accounting firm primarily does tax work, for example, begin to think about pushing that boundary and expanding your firm’s…...

Password protection best practices for lending and risk management solutions

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Across personal and professional platforms, bankers have experience with managing passwords to online services. Yet given the confidential nature of data often stored in web-based lending, credit risk and portfolio risk solutions, bankers have to pay special attention to potential weaknesses in password management. This post aims to share general…...

The ALLL today – data challenges

Sageworks
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With the recent release of the Financial Accounting Standards Board’s (FASB) guidance on the CECL model, banking professionals and consultants have been theorizing about the impact the standard will have on current bank processes. While it is important for these banking professionals to be prepared, consultants are stressing the importance…...

5 common lending challenges and how software can help

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Institutions are equipped to solve five common challenges when they provide staff with the necessary data through an integrated software solution: 1. Improving transparency into business development. At most institutions, lenders track outstanding opportunities and their sales activities in spreadsheets, calendars and notebooks, and without a centralized system, it’s challenging…...

Building your growth plan: Key metrics to consider – Technology

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The wave of technological innovation that has swept the business world in the past several years has fundamentally altered how many industries do business. Perhaps no industry has been so disrupted by this wave of technological innovation as the banking industry. Technological innovation has enabled FinTech start-ups to compete in…...

Whitepaper: How to improve financial presentations to clients

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The following is an excerpt from the Sageworks whitepaper "How to Improve Financial Presentations to Clients". Numbers are the starting point for most business decisions, whether it be seeking a bank loan to start or expand a business, obtaining board approval for a new project or clearing a new hire…...

Summit Poll: Which area of the loan portfolio is your focus for growth?

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In September, Sageworks hosted the 5th Annual Risk Management Summit at the AT&T Executive Education and Conference Center in Austin, Texas. The Summit was the largest Sageworks event to date and featured presentations from industry leaders, interactive roundtable discussions, panels and networking opportunities. During Banker Appreciation Night, a dinner event…...

Building your growth plan: Key metrics to consider – Credit analysis

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As discussed in a previous post, many banks and credit unions are turning to loan portfolio growth as the way forward. These growth plans typically focus on finding new ways to attract more qualified applications. While increasing the volume of qualified loan applications is an important component of any growth…...

Building your growth plan: Key metrics to consider – Marketing

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As the leadership teams at many banks and credit unions perfect plans to grow their loan portfolios, management can depend on several key metrics to measure the effectiveness of their plans and execution. As discussed in a previous blog post, Part 1, one such metric is the loan application conversion…...

Building your growth plan: Key metrics to consider – The Lending Funnel

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For many banks and credit unions, it is hard to feel anything but stuck between a rock and a hard place right now. In the current market, banks and credit unions are facing pressure on all fronts. Interest rate margins remain slim, and FinTech companies that compete directly with traditional…...

2016 Risk Management Summit wrap-up

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Sageworks hosted the 5th Annual Risk Management Summit September 14-16 at the AT&T Executive Education and Conference Center in Austin, Texas. The Summit was the largest Sageworks event to date and featured presentations from industry leaders, interactive roundtable discussions, panels and networking opportunities. Key to the discussion this year were…...

How accountants can build revenue and relationships through consulting meetings

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Have you ever wondered whether your clients question the value of your meetings and engagements?  If so, it might be time to learn how you can elevate your role as a CPA from a finance or tax advisor to one of a business consultant. Having business consulting meetings with your…...

The questioning mind: Best practices for ensuring professional skepticism in the audit process

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By Lana Richards, Contributing Writer, Sageworks Auditors tend to get a lot of eye rolls from client personnel. After all, no one likes to have their work questioned or their errors pointed out to their bosses. Yet that questioning is foundational to the audit practice. If auditors are not appropriately…...

What is keeping your financial institution from growing?

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A common problem impacting productivity and the ability to serve customers is inefficient processes. Many of these are inherited and accepted as “just the way we do things.” But in order to work smarter, not harder, and provide a good experience for customers, inefficiencies should be challenged in favor of…...

The importance of peer benchmarking

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Whether peer analysis is a new practice or a tested strategy at your bank, it is always important to begin any analysis with an overview of key performance metrics. As Tim McPeak, an executive risk management consultant at Sageworks, pointed out in a recent webinar, it may seem obvious, but…...

The past and future of the valuation industry

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The value of a business was once defined in simple terms. Prior to 1920, if someone had to value a business, there was no “valuation industry,” so it’s likely that the only reasonable or logical way to do it would have been to look at the business's assets, its liabilities…...

Know your competition: Best Practices for using peer bank data

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This post is based on a webinar led by Tim O’Rourke, Chairman and CEO of Matthews, Young – Management Consulting. Why analyze peer institutions? A peer analysis – where a bank compares its performance to that of similar institutions - equips bankers to think strategically about a bank’s current position…...

3 Things impacting consumers’ satisfaction with financial institutions

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According to the Consumer Financial Protection Bureau’s (CFPB) Monthly Complaint Report, consumer banking complaints increased by 26 percent from 2015 to 2016. This three-month rolling average compares the number of complaints reported from May to July in 2015 against the same period in 2016. In total, the complaints increased from 1,890…...

How the 2016 election impacts community banks and credit unions

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According to Sageworks’ Bank Information resource there are nearly 12,000 community banks and credit unions across the United States. Those main-street institutions employ and service millions of voters in towns both large and small, but are often overlooked and underestimated in the role they play in the political process. With…...

Branch transformation: A data focus

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One of the biggest shifts in banking in the past few years has been the decline of the branch. As Anthony Burnett of LEVEL5, a branch consultancy, mentioned in a recent webinar, many banks are struggling to make the old branch model work in the modern banking environment. In a…...

Why financial institutions are updating loan pricing strategies

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Progressive banks are increasingly turning to stronger pricing models that incorporate loan risk, borrower profitability and bank strategy to ensure that the customer always sees the bank’s best rate. This rate may not be the lowest rate, but it will be its best rate that aligns with the strategic goals…...

2016 Risk Management Summit agenda addresses CECL concerns

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In early June, Sageworks hosted a Current Expected Credit Loss (CECL) Workshop Series webinar and asked the attendees “Given what we know about CECL, what area do you feel will see the largest impact?” Greater than 81% of the 595 bankers who replied said that they expect the largest impact…...

3 Ways credit unions are driving growth

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According to the Credit Union National Association (CUNA), credit unions had a record year in 2015, with 3.7 million new members bringing total membership to 102 million -- surpassing the 100 million-mark for the first time ever. This impressive growth is not surprising when you consider these three ways credit…...

Does your firm suffer from these 3 false claims?

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Let's face the facts. Public accounting firms tend to have the same challenges when they try to create value for clients. Creating value often means launching or enhancing an Advisory practice. In fact, in 2015, 32 percent of small-to-mid-sized North American accounting firms saw growth in Advisory and consulting services…...

Best practices for documenting analytical procedures

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By Lana Richards, Contributing Writer, Sageworks Documenting audit and review procedures often feels more like administrative than value-adding work. And some procedures—like analytics, for example—require more extensive documentation due to the amount of judgment applied in their selection, design and evaluation. While it can be quite tempting to skimp on…...

6 Ways to Increase Dental Practice Sales

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When running a dental practice, there are plenty of opportunities to increase sales. These opportunities can come in the form of simple changes to how the practice is operated. Read ahead for some tips on how to increase sales for a dental practice. Implement a text appointment reminder system If…...

Three ways bank-marketing executives should use data

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The quote, “You can't manage what you can't measure,” attributed to both American statistician W. Edwards Deming and Austrian management consultant Peter Drucker, has seen significant play as data management has increasingly become more important to professionals in all industries. Data may serve as a buzzword for marketers, but it…...

Interviewing staff candidates for your firm: Some best practices

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When looking to interview candidates to grow your accounting or valuation firm, what is your greatest concern? Is it recruiting and managing the process? Facilitating a flow throughout the actual interview? Follow-up or determining the right questions for the interview? If asking questions is your challenge, you are not alone.…...

Measuring loan-portfolio credit quality

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Posted by Sageworks

All financial institution personnel play a role in the maintenance of positive asset quality through loan portfolio management, especially during periods of growth. The credit process inherently has risks. But as the OCC instructs examiners in its Comptroller’s Handbook, loan portfolio management is the process by which these inherent risks…...

Which are America’s healthiest credit unions?

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Posted by Sageworks

For many people, trusting another party with their hard-earned money can be an anxiety-inducing experience. Whether it is securing funds in a checking or savings account, or investing in a retirement fund, many Americans need a sense of security that comes with an outstanding experience from their financial institution. Credit…...

How to implement consistent credit risk pricing

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Many banks and credit unions have adopted sophisticated risk-management practices, and their board of directors has to play an active role in ensuring that risks are well understood in overseeing risk exposure. Credit risk refers to the potential for a loss if a borrower or a counterparty to the transaction…...

Why you don’t want to miss the 2016 Risk Management Summit

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With the recent release of the Financial Accounting Standards Board’s (FASB) guidance on the Current Expected Credit Loss (CECL) model, Sageworks' Summit is uniquely positioned to provide the latest information on how institutions can prepare for the changes and what the impact may be once effective.  The 2016 Risk Management…...

What’s wrong with your appraisal process? Common deficiencies

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By Carl Streck, Co-founder and CEO, Mountainseed In a perfect world, an appraisal would land on your desk free of error. However, as we know, the world isn’t perfect, and as such, neither are appraisals. With the average appraiser completing between 220 and 240 appraisals per year, it’s only natural…...

Why your institution needs a standardized loan pricing model

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How Loan Pricing Models Add Value to the Institution Implementing a loan pricing model often requires a process change for lenders and business development staff at the institution, and may necessitate a few extra steps. But if the institution evaluates the change bank-wide and the impact that a standardized pricing…...

3 Ways the 2016 Risk Management Summit will ease CECL transitions

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Sageworks will host the 5th Annual Risk Management Summit September 14-16 at the AT&T Executive Education and Conference Center in Austin, Texas. The Summit will feature presentations from industry leaders, interactive roundtable discussions, panels and networking opportunities. Central to the discussion this year will be strategies for transitioning to the…...

New practice aids help avoid valuation hazards

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The number of small businesses listed for sale is at a seven-year high, and the median sale price is also the highest in several years, according to BizBuySell, an online business-for-sale marketplace. At the same time, BizBuySell data from the first quarter indicate that only about 6 percent of businesses…...

Infographic: How do landscaping businesses increase cash?

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any business owners have trouble managing the line between business and personal expenses. To increase cash for your business without hurting your personal finances, it is important to understand your cash flow situation.  These situations make it hard for business owners to gauge the cash flow of the business. The…...

How can credit underwriting help maintain credit quality?

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As the OCC noted in its 2015 Survey of Credit Underwriting Practices, credit risk is increasing as underwriting standards have eased more than tightened for commercial and retail loan products for the third consecutive year amid increased competition for business. “Similar to pre-crisis surveys, the 2015 survey reflects that many…...

Price services more effectively with value pricing

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By Melinda Crump, Sageworks Have you been evaluating firm profitability and how to more effectively price the services you offer? If so, consider changing your pricing method from the standard billable hour to value pricing. Why? Price chases value, and by creating more value, you will be able to “capture…...

Three ways the lending department can help maintain credit quality

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Loan officers and the chief lending officer can play a role in protecting asset quality during the sales and application process, particularly during times of rapid loan growth. Here are three ways that the lending department can proactively help manage credit quality. 1.  Request a consistent set of product-specific documents.Consistent…...

What every business owner needs

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Would you like to provide more services to each client or to improve the quality of each client conversation? Conferring with a client for the first time, or perhaps a friend we've known for years who is now in need of a business valuation for exit planning or other reasons,…...

Poll: Vast majority of bankers still manually create credit memo

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A credit memorandum is meant to summarize the information collected during the loan application and credit analysis processes. This large document bridges the gap between underwriting and funding, and it is a pivotal point in the life of the loan. A credit memorandum is used by the loan committee to…...

Everyday technology for everyday challenges at accounting and valuation firms

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By Melinda Crump, Sageworks Did you know that many of the daily maintenance and management activities in your firm can be handled more effectively with technology? And while the word “technology” itself sometimes sounds like a daunting challenge, good technologies are actually designed with the end user in mind --…...

How “Veiled Value” hurts your accounting firm

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By Jason Blumer, CPA Founder, The Thriveal CPA Network Listen to Blumer's presentation on different pricing structures for firms, the economic reality of value, and how to influence your clients during pricing. Access the replay of the recent Sageworks webinar featuring him: “Considering Value Pricing to Effectively Price Your Services.”…...

The business of accounting: Building an engagement funnel

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Traditional marketing operations such as print advertising and organic referrals provide an unreliable number of engagements for partners and can stunt firm growth. Accountants should begin to think about their clients and prospects as it relates to where they fit within a sales funnel. Though most partners are comfortable with…...

Notes on normalizing adjustments to the income statement

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Valuation experts know that normalizing is an important and sometimes challenging step in the business valuation process. Business owners themselves may not realize how their own efforts can incorrectly inflate or deflate their sense of the valuation. Other owners may provide limited information on which to base the valuation, which…...

Why would anyone want to listen to a podcast from an accounting firm?

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Guest post by  Becca Davis Director of Practice Growth, Rea & Associates I know what you’re thinking – listening to a podcast from an accounting firm is probably about as entertaining and insightful as watching paint dry. But “unsuitable on Rea Radio” isn’t your typical accounting podcast, which is why…...

Using better data for loan origination

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Sageworks focus grouped more than 100 bankers in 2015 to understand their goals and challenges. A recurring theme within origination was time-wasted with data entry – reading tax returns and typing the data into spreads. That wasted time meant lenders were spending less time trying to grow the portfolio and…...

Business owners: Are you financially literate?

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April was National Financial Literacy Month (also known as National Financial Capability Month), but for business owners, the need for a financial understanding of what’s going on within the establishment is a year-round affair.  Unfortunately, many business owners never received formal training in finance or accounting. Others are more focused on…...

National Small Business Week celebrates the American entrepreneurial spirit

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Guest Post By Maria Contreras-Sweet, Administrator of the U.S. Small Business Administration What creates two out of three net new American jobs; produces close to half of our nation’s goods and services (nonfarm private GDP); and can be found, coast to coast, in every small town, big city and rural…...

Business valuation: In defense of simplicity

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By Erik Kobayashi-Solomon, Principal and Founder, IOI Investor Services Linda is 31 years old, single, outspoken and very bright. She majored in philosophy. As a student, she was deeply concerned with issues of discrimination and social justice, and also participated in anti-nuclear demonstrations. Which is more likely true about Linda?…...

How to make better lending decisions with a probability of default model

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As technology and data collection improve, banks and credit unions are finding ways to use this information to improve their loan decision making and thus improve their asset quality in the long term.  The best way to maintain asset quality is to make good loans…and that involves validating that borrowers…...

The importance of effective data governance for banks

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With the pressures of changing regulations and data security continuing to increase, banks and credit unions must remain vigilant when it comes to their data. Ensuring that data is of high quality, accessible and secure is key to keeping up with this changing environment. In addition, institutions should determine how…...

Are you a trusted advisor?

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At Sageworks, we have conversations with thousands of accountants each month. One characteristic we have noted that successful accountants have in common is their ability to leverage technical skills with a sales mentality and their “soft skills.” You could refer to this as the skill set necessary to create dynamic…...

Avoiding the crushing sound of tax season

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“The hardest thing in the world to understand is the income tax.” –Albert Einstein We could list many other amusing quotes about taxes and tax season. You can probably think of a famous quote right now. Tax season, as accounting firms know, is not just busy. It's the busiest time…...

Poll: Bankers feel they aren’t pricing loans correctly

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Given the current state of interest rates, loan pricing has become extremely competitive and net interest margin has taken a hit at most banks. This intense competition has forced bankers to simply match prices with competitors, not knowing if the loan is priced correctly or profitable for the institution.  …...

Two keys to building a strong credit culture

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Posted by Sageworks

In today’s banking environment, there is strong pressure for banks and credit unions to grow the portfolio profitably. With more competition, institutions are lending in new areas, adjusting underwriting standards and seeking to grow via mergers and acquisitions. Despite the pressure, banks and credit unions must remain diligent across departments…...

How does your accounting firm stack up against others?

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Posted by Sageworks

Like most marketplaces, accounting firms look to the most successful firms to identify ways that they can grow. Another reason accountants look to more developed firms is to discover, “Are we heading in the right direction? Are we putting resources where they need to be put?” Observing the practices and…...

The Real Price of Risk: How to use risk ratings to increase the profitability of your loans

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Posted by Sageworks

Risk ratings are the basis for understanding credit risk in the portfolio, yet many institutions struggle to maintain and apply an objective risk rating system. Accurate risk ratings allow institutions to better price loans and account for risk in the overall portfolio. This webinar will cover the basics of identifying…...

7 Upkeep Tips for Landlords

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Posted by Sageworks

When renting out a home or apartment building, there are plenty of ways to avoid future costs by properly maintaining the property. These often come in the form of simple things a landlord or tenant can do on a regular basis. Read ahead to learn some easy tips and tricks…...

ALLL at many banks, CUs reliant on 1-2 people – poll

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Posted by Sageworks

Two-thirds of bankers in a recent poll said their allowance for loan and lease losses (ALLL) is primarily calculated by only one or two people in the institution, according to Sageworks, a financial information company that provides loan portfolio and risk management solutions to banks and credit unions. Sageworks conducted…...

7 marketing tips to engage your clients about starting a succession plan

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Posted by Sageworks

By Warren Sheydwasser With no shortage of tasks to complete during tax season, many financial professionals don’t need help expanding their to-do list. Given that it’s one of the few times during the year you will likely connect with all of your clients, some additional communication strategies can go a…...

3 external challenges banks and credit unions are facing today

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Posted by Sageworks

Financial institutions face a range of challenges arising from issues that are external to the bank or credit union, including: -  Interest rate environment-  Changing regulatory and accounting landscape-  Competitive pressures, especially for commercial and industrial (C&I or MBL) loans.After several years of trying to mitigate the impact of low…...

Upload data quickly from QuickBooks Online for financial analysis, valuations

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Posted by Sageworks

Accountants and valuation professionals can spend less time at the computer screen and more time identifying revenue-based consulting opportunities, thanks to the integration of ProfitCents, Sageworks’ flagship financial analysis platform, and the Sageworks Valuation Solution with Intuit’s QuickBooks Online. The integration now allows financial professionals to upload client data directly…...

Join Sageworks and Linda Keith Wednesday February 24th for “The Cs of Credit Guidelines for Tax Return Analysis” Webinar

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Posted by Sageworks

In this webinar, Sageworks is teaming up with Linda Keith CPA again to bring you more great information about tax return analysis.  Linda has been a guest speaker on several Sageworks webinars that covered topics like Global Cash Flow, Red Flags for Tax Return Analysis and Making Judgement Calls for…...

4 challenges banks and credit unions are facing today

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Posted by Sageworks

The following is an excerpt from the Sageworks whitepaper "Optimizing Capital: Challenges and Opportunities for Financial Institutions". Given the many differences between a community institution and a bank with $100 billion in assets, the challenges facing bank executives and their financial institutions may differ dramatically at various times. Yet all…...

A strong year (financially) for U.S. accounting professionals

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Posted by Sageworks

As professionals who specialize in finance, preparing financial statements, and assisting business owners with their financial performance, one would suspect that accounting, tax preparation, bookkeeping, and payroll service companies would tend to have a firm grip on their own financial performance. And looking at statements filed over the past year,…...

Positioning your firm in a dynamic marketplace

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Posted by Sageworks

By Nancy A. Damato  President, Senior Consultant at Accounting Advisory Group, LLC The CPA firm marketplace is changing rapidly, as consolidation of the profession is creating larger firms with greater resources and expanded geographic marketplaces, while the competition for quality clients and staff has reached an all-time high. All of…...

Early-bird registration now open for 2016 Risk Management Summit

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Posted by Sageworks

Sageworks recently announced the dates and location for the 2016 Risk Management Summit. Set for September 14-16 at the AT&T Executive Education and Conference Center in Austin, TX, the Summit is the premier banking conference covering the ALLL and stress testing, and it will feature presentations from industry leaders, panels,…...

8 Restaurant Technologies to Boost Business

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Posted by Sageworks

Keeping up with the latest technology is often a critical factor in remaining competitive in the restaurant industry. Considering all of the technological advances that have been made in the last decade, there are now plenty of opportunities to improve efficiency and increase restaurant sales. Read ahead to learn about…...

[Handout] Show your clients how valuations can impact their businesses

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Posted by Sageworks

Selling valuations can be complex and business owners don't always know why they need one. Good news...sometimes the valuation professional doesn't need to sell the service at all. Educating business owners on why valuations matter and how they improve businesses in both the short and long term can help business…...

Optimizing capital: Challenges and opportunities for banks and credit unions

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Posted by Sageworks

The following is an excerpt from the Sageworks whitepaper "Optimizing Capital: Challenges and Opportunities for Financial Institutions". Serving customers and helping them achieve their financial goals are often identified by bank and credit union executives as their organizations’ top objectives. Whether it is Wells Fargo (with $1.6 trillion in assets and thousands of employees)…...

Mitigating risk (and legal action) with business intelligence and client relationships

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Posted by Sageworks

By Jeff Borschowa  Author, Freelance Writer, Speaker, Growth Specialist at Dream Practice Possible Errors Accounting is a risky business. Many accountants I know, myself included, worry about what could happen if we were to be sued. The sad reality is that accounting professionals are a target and are at risk…...

Whitepaper: How routine client meetings could fuel a business valuation practice

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Posted by Sageworks

The following is an excerpt from the Sageworks whitepaper "How Routine Client Meetings Could Fuel a Business Valuation Practice". Routine meetings with business clients, such as those ahead of or after tax season, tend to cover housekeeping items related to preparing financial statements, tax payments or tax returns. These routine…...

Obstacles to an effective loan review

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Posted by Sageworks

Click here to read the entire whitepaper written by Tim McPeak "A ship is always safe at the shore, but that is not what it is built for.” – Albert Einstein Banks generate most of their revenue by lending money, and lending money, by definition, involves a certain amount of…...

Stuck in compliance: The Grim Reaper of accounting firms

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Posted by Sageworks

Progressive accounting firms seek consulting opportunities so their firms can take advantage of more lucrative advisory service offerings. Recent discussions with industry thought leaders and CPAs that are providing advisory services have highlighted a key benefit to this move. Often the amount of time taken to complete certain advisory services…...

10 Twitter accounts every accountant should follow

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Posted by Sageworks

Information overload seems to be an occupational hazard for anyone spending time on the internet these days, particularly on social media channels.  Coupled with the fact that new social media platforms pop up on what seems like a daily basis, it can be tough for financial professionals to sift through…...

Why you should attend the “CECL Workshop Series”

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Posted by Sageworks

**The FASB issued the final CECL standard on June 16, 2016. For up-to-date information and resources, access the updated CECL Prep Kit. Are you ready for CECL? The Financial Accounting Standards Board (FASB) is expected to release final guidance in Q1 for the current expected credit loss (CECL) model. Implementation…...

The ABCs of becoming your client’s most trusted advisor

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Posted by Sageworks

By Adam Blitz, Principal and Consultant at GetBlitzed Solutions When I was in college, working on obtaining my degree in business economics at UC Santa Barbara, I can recall that I was required to take ONE communications course. Only one 4-hour communication course of a single semester during my entire…...

4 Lessons to be covered in Sageworks Credit Analysis User Groups

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Posted by Sageworks

Sageworks recently announced its lineup for regional User Groups in 2016, including events in Atlanta, Philadelphia, Chicago, Los Angeles and Dallas. Each event will feature 2 tracks: one for users of Sageworks Credit Analysis and one for users of Sageworks ALLL. If a bank or credit union is considering these…...

4 Reasons to review your bank’s risk rating system

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Posted by Sageworks

Risk rating practices for the loan portfolio can draw scrutiny from regulators, to be sure. One of every six financial institutions responding to the 2015 Sageworks Bank & Credit Union Examination Survey said that examiners criticized or required action related to their risk ratings practices.  But avoiding regulators’ inquisition isn’t…...

Credit unions strengthen, but is there cause for concern?

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Posted by Sageworks

Glatt Consulting, a leading credit union consulting firm, publishes a proprietary Credit Union Industry HealthScore each quarter. The HealthScore, based on a 5-point scale (0 reflects poor health, 5 reflects exceptional health), calculates overall credit union health by grading them on 11 ratios, including net worth, ROAA, operating expense, efficiency,…...

Top 10 business valuation blog articles from 2015

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Posted by Sageworks

Did you miss them? Read the most popular business valuation articles published by Sageworks in 2015. Visit the Valuation Blog to read the latest. Most common challenges facing business valuation professionals  The process of valuing a business combines both art and science and can be arduous. Generally speaking, a detailed,…...

3 simple ways to differentiate a valuation practice in 2016

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Posted by Sageworks

Let's assume, for the purpose of this article, that you are operating a successful valuation or accounting firm. Or, perhaps you're an M&A professional or business broker, but no matter the nature of your work, you have a cash flow positive, successful organization. Yet your work valuing businesses and advising…...

Be a profit center: Add value to your consulting engagements

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Posted by Sageworks

By Adam Blitz, Principal and Consultant at GetBlitzed Solutions CPA’s can be invaluable. However, CPA’s often dive into accounting work that only meets the compliance requirements. It’s common knowledge that clients need tax returns or financial statements completed and submitted in a timely manner. It’s also well known that the…...

Commercial lending software: Buyer’s guide

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Posted by Sageworks

Depending on the size of your bank or credit union, your credit department may be set up in different team structures. It might even be just a few people with shared responsibility. If your institution underwrites and reviews enough loans annually, it’s likely that you have adopted some type of…...

12 Questions to ask in consultative client meetings

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Posted by Sageworks

When accountants go to client meetings they run the risk of either going in without a plan or failing to innovate their usual tactics for understanding their client. Since most business owners view accountants as a commodity, prioritizing the ways you communicate with your client during your annual or quarterly…...

6 Questions to help accountants sell advisory services

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Posted by Sageworks

If you are following the large accounting industry news outlets, it’s no surprise that the role of an accountant has been, is currently and will continue to shift from compliance work to consulting engagements.  The resistance to this change has been threefold: First, there is not enough time in the…...

How to weight your risk rating system

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Posted by Sageworks

In today’s environment, having an effective risk rating system in place helps beyond determining an institution’s credit approval process or loan pricing. These systems also impact broader risk management practices, including setting an institution’s reserve, stress testing, determining risk appetites and strategic planning. With little prescriptive guidance available, banks and…...

Most popular valuation webinars of 2015

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Posted by Sageworks

Looking back at 2015, the Sageworks valuation team hosted and attended webinars across a variety of topics from marketing a practice to finding the bias in a valuation. Each of the webinars listed below is available on demand to watch at no cost. In this article, we highlight some of…...

6 Ways a Plumbing Business Can Boost Sales

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Posted by Sageworks

Boosting sales is one of the first steps towards becoming a more successful and profitable business. Many of the tips below can be simple changes that a plumbing business can make to help improve their sales. Read on to learn about some tips and tricks to help improve sales in…...

7 Ways to Cut Costs in a Medical Practice

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Posted by Sageworks

When running a medical practice, there are multiple ways one can cut down on their total expenses. Cutting out unnecessary expenses is a critical component of becoming more profitable. Read ahead to learn more about the different ways that a medical practice can reduce costs. Invest in Pre-Registration Software Consider…...

Whitepaper: How technology is changing the way firms operate

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Posted by Sageworks

The following is an excerpt from the Sageworks whitepaper "The Automation Revolution: How Technology is Changing the Way Firms Operate". As consumers adopt the latest technology, businesses must do the same in order to provide services and customer experiences that align with today’s technology. The feeling of visiting a financial…...

Is your website generating new business for your accounting firm?

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Posted by Sageworks

By Ryan Himmel, CPA, Founder & CEO, TaxResearchPro By now, many accounting firms have a website. Firms are motivated to have a site because other firms in the area have one and most clients expect it. Still, saying you have a website is not enough. You should be able to…...

Professional skepticism and other 2015 audit focus areas

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Posted by Sageworks

The auditing process is mechanical in its function but requires a curious mind to prevent and detect misstatements that can hurt a business. Each year, leaders in the industry gather together to discuss ways to make the craft of an audit more deliberate and structured. As a result of these…...

Is 2016 the year for bank M&A?

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Posted by Sageworks

For years, the banking industry has been talking about mergers and acquisitions (M&A). While some consolidation has occurred, it still hasn’t reached levels that many expected. Bank Director’s 2016 Bank M&A Survey, sponsored by Crowe Horwath, was recently released and offers insight on current M&A trends in the banking industry.…...

Tips for telling business owners why valuations matter

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Posted by Sageworks

Finding prospective valuation clients isn't always easy, and even once a firm has identified a prospect, communicating the value of valuations is critical to a successful relationship. Sageworks hosted a webinar on the topic, "How to Find New Business Valuation Clients" in order to explore tactics for identifying clients as well as the…...

What borrower data to collect for agricultural lending

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Posted by Sageworks

Banks involved in ag lending understand that the volatility of the industry – unpredictable weather patterns, variable commodity prices and more – can often lead to higher amounts of risk compared to other concentrations. Given recent news about decreasing ag incomes, combined with increasing demand for ag loans, banks need…...

Before and after tax season checklist: How to increase revenue and add value

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Posted by Sageworks

Hectic schedules and an immense workload often prevent accountants from fulfilling their role as a trusted advisor during tax season. Time crunches mean that some strategic planning that accountants wish they could implement for their clients goes out the window during these months. Though strategic planning for clients must be…...

Managing your credit union’s loan data

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Posted by Sageworks

Whether it’s part of a CECL preparedness conversation or part of a more proactive approach to risk management under existing regulatory expectations, the topic of “loan-level data” has repeatedly come up since the 2012 proposal from the FASB. As a result, at Sageworks, we have received many questions from our…...

What is the impact of the NCUA’s risk-based capital rule?

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Posted by Sageworks

Last month, the National Credit Union Administration (NCUA) approved the long-awaited final rule on risk-based capital requirements for credit unions. The rule aims to reduce the possibility of high-risk credit unions exhausting their capital and causing systemic losses, which all federally insured credit unions would have to cover for through…...

Why business owners can fail, even during growth

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Posted by Sageworks

By Bakley Smith, CFA Most business owners - especially those in the startup space - have an eye fixed on valuation. At what level does the market value the company? The media, of course, feeds the frenzy with television shows, articles, podcasts and a steady stream of click bait, aimed…...

OCC warns about increasing credit risk

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Posted by Sageworks

With the recession fading into the more distant past, banks – in particular, community banks – have seen several years of loan growth. Banks, according to Comptroller of the Currency Thomas Curry, are starting to reach for additional growth by lending to less creditworthy borrowers, a move that increases risk…...

Preparing to execute well this tax season

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Posted by Sageworks

A significant amount of planning is typically involved before most major events. For example, D-day, the most comprehensive invasion to ever take place, was planned and scheduled with extreme detail months before its execution on June 6, 1944. Likewise, accountants each year experience a tax season that requires detailed planning…...

The business case for portfolio stress testing

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Posted by Sageworks

Some financial institutions consider stress testing the loan portfolio as one more regulatory issue to address, but that view is short-sighted, according to John P. Behringer, RSM’s national leader for credit risk services. Portfolio stress tests can provide a number of benefits beyond compliance with regulatory expectations, Behringer said at…...

Data, where art thou?

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Posted by Sageworks

Banks and credit unions rely on their borrowers for updated information, which they in turn use to make accurate credit decisions. Financial statements, tax returns, collateral appraisals, rent rolls, loan agreements, economic data, credit reports, images, etc. all factor into credit decisions, making document and data management a big deal…...

3 Ways to capitalize on your tax season engagements

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Posted by Sageworks

Every year, accountants brace themselves for the inevitable tax season. For many accountants, unfortunately, tax season means that lucrative consulting work that can diversify revenue and bolster firm growth throughout the year gets put on hold in order to handle the mountains of personal and business tax returns. However, tax…...

Why your business should have a buy-sell agreement in place

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Posted by Sageworks

By Rachel Flaskey, CPA/ABV/CFF/CGMA Building a strong business foundation begins with you, the owner. Having a formal written document to detail ownership transition plans is a best practice that should be utilized by business owners, regardless of when the business transition will be happening. The article below outlines four key benefits…...

5 Common errors in global cash flow analysis

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Posted by Sageworks

For banks and credit unions, the term “borrower” can often take on many meanings – especially in complex situations where the “borrower” can have multiple owners, businesses, real estate entities and/or farms. When combining personal financial information, the analysis can get even more complex. To more objectively calculate a global…...

Process key to new hires at your firm

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Posted by Sageworks
will staff shortages drive business valuation demand

As the fall ramps up, many accounting firms will see a steady stream of new faces in their halls. Recent college graduates have already or soon will find their new homes in cubicles, wide-eyed and eager to learn the ins and outs from their firm’s senior staff. While a company…...

How to create a credit risk rating system

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Posted by Sageworks

For banks and credit unions, a popular tool to monitor credit risk is a standardized risk rating system, which can serve several purposes. These systems often determine credit approval processes, covenants placed on the borrower and how loans should be priced. They can also form the basis for broader risk…...

7 Ways to Cut Energy Costs When Running a Convenience Store

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Posted by Sageworks

When running a convenience store, energy costs can eat up a lot of revenue. Although some energy costs are inevitable, others can be significantly reduced by following some of these easy-to-implement tips. Gas Station Bay Rather than having the gas station bay constantly lit at night, use one general overhead…...

How business brokers can add value and create growth opportunities for clients

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Posted by Sageworks

Remember the days of yellow mustard, when there was only plain, yellow mustard? Malcolm Gladwell published a story about how the mustard market changed forever in the 1980's. All of a sudden mustard came in glass jars, had French-sounding names, and was featured in commercials with a Rolls-Royce driving down a country…...

Attracting and retaining female staff

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Posted by Sageworks

It will come as no surprise that one of the largest concerns facing accounting firms today is staffing. For some firms, the way to solve this is by ensuring there is a greater gender balance among the staff. Although women are entering the profession in higher numbers than ever before,…...

Goodwill is a function of jurisdiction, appraiser says

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Posted by Sageworks

Republished with permission from Business Valuation Resources (www.bvresources.com). No two cases are alike, and different jurisdictions approach goodwill and noncompete agreements differently, cautions Jim Alerding (Alerding Consulting LLC), in response to the BVWire item on the Mauceri Texas divorce case, in which Bob Dohmeyer (Dohmeyer Valuation Corp.) was the prevailing expert. Therefore, it would be a mistake to…...

Is your credit union ready to grow member business lending (MBL)?

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Posted by Sageworks

Member business lending (MBL) has been a hot topic in the financial services community this summer, particularly as the industry awaits finalization of the NCUA’s rule changes. While credit union lending to businesses has been on the rise over the last several years, both in terms of dollars and the…...

Credit union membership, lending up in Q2

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Credit unions are on the rise, as indicated by the NCUA in the second quarter of 2015. Last week the NCUA reported that the total number of credit union members had surpassed the 101 million mark, and overall lending was up as of the close of Q2. According to the…...

The power of Twitter for recruitment

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Twitter may not be the first site that comes to mind for job hunters, but the numbers don’t lie – in 2012 eight million applicants found jobs using the social media application. Using the platform for recruiting purposes is also increasingly common. A marketing firm in Dallas uses the site…...

Avoid pitfalls of a growing business valuation practice

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The baby boom generation is often marked by the free-spirited popularized during the 1960’s and 1970’s. The same generation that preached “peace, love and understanding” also funneled that spirit into some of the most successful entrepreneurial ideas ever, like the iPod and the Roomba. Now, as the generation ages, many…...

Attracting and retaining millennial talent

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With the inevitable retirement of baby boomers, it is critical to have plans in place for developing the future leaders of your firm. This process begins by hiring potential partners who have the potential to grow into your firm’s cash cow. How does your firm begin to identify and draw…...

4 Reasons to attend the 2015 Risk Management Summit

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The 2015 Risk Management Summit is less than a month away. Executives from more than 100 banks and credit unions representing 39 states have already registered to join their peers, industry experts and Sageworks in Chicago for the premier ALLL and stress testing conference. Registration is still open, but very…...

Will credit unions return to an 18-month exam cycle?

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“… it’s not 2008.” This is the sentiment of several high-profile executives regarding the National Credit Union Administration’s (NCUA) stance on examination cycles for credit unions. There’s been much back and forth over the last week on this subject and the NCUA’s desire to stick to a 12-month examination cycle…...

The benefits of audit technology

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Current technology has enabled auditors to analyze extensive amounts of financial data, allowing accounting professionals to more easily identify areas of risk. These technologies have also helped streamline time per audit and produced higher quality assurance. Is your firm taking advantage of these current technologies? What might the future of…...

Ag lending risk increasing as result of declining incomes

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According to recent data from the Agricultural Finance Databook, non-real estate farm loan volumes continued to rise in the second quarter of 2015, increasing by five percent over the second quarter of 2014. This growth continues the trend from the first quarter of 2015, which saw an increase of eight…...

Expanding your member business loan (MBL) portfolio through credit union service organizations (CUSOs)

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Earlier this summer, the NCUA unanimously approved a series of proposed changes to their regulations on member business lending (MBL). These amendments, if adopted, would lessen current restrictions to make it easier for credit unions to lend to businesses. The proposal just concluded its 60-day comment period and a final…...

Video: How to prepare for valuation industry growth

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Industry research suggests that much of the growth in the business valuation industry is due to baby boomers retiring, with the intent to sell their businesses. While growth is superficially appealing, many firms need to consider if they are prepared to meet the increased demand for those valuations. Like most things in…...

The Bermuda Triangle of Valuation: Bias, Uncertainty and Complexity

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By Aswath Damodaran Professor of Finance, NYU Stern School of Business Introduction from Sageworks: Studies have shown that sizable numbers of business owners look to transfer their ownership interests in the next decade, and a major concern for many is whether they’ll get out of the business what they expect.…...

Is your bank or credit union struggling with inefficiencies?

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A common problem countering workplace productivity and the ability to serve customers is inefficient processes. Many of these are inherited and accepted as “just the way we do things.” But in order to work smarter, not harder, and provide a good experience for customers, inefficiencies should be challenged in favor…...

Guiding your succession planning

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For many years leaders in the accounting profession have preached the need for firm succession planning. And there is no time like the present. The retirement of baby boomers combined with high turnover and the slow growth of new entrants to the profession all point to the inevitable passing of…...

Why fair value isn’t always the right value

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By Bakley Smith, CFA The debate between fair value and historical cost accounting is a hot topic for academics, regulators and investors. As noted by a University of Chicago Booth School research paper and Harvard Business Review, the debate centers on the use of fair value accounting and its impact…...

Succession planning: Defining and finding an ideal candidate

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Succession planning, whether you are a sole proprietor or a top 200 firm, is a delicate topic. With such a transition there are not only financial components to consider but also the relational changes that could occur. These changes will not only affect dynamics within the company but also the…...

Could a bank’s best asset to perform stress testing be in HR?

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It is no doubt that stress tests for the nation’s largest banks can be an anxiety-inducing experience for those institutions being reviewed. Since the passing of Dodd-Frank, more than 30 megabanks are in the hot seat annually while their ability to withstand the financial stress of dynamic shifts in the…...

Infographic: 5 Bar Promotion Ideas

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It is becoming increasingly important for bar establishments to find ways to differentiate themselves from others in the industry in order to remain competitive in the marketplace. Finding quick ways to increase profitability can be tough, but the infographic below details 5 simple ideas for how bars can better promote…...

Loan underwriting and administration remain a top concern of bank examiners

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In its semiannual report last month, the Office of the Comptroller of the Currency (OCC) noted that the banking industry has loosened its standards for underwriting loans, bolstering the credit risk for financial institutions. While an increase in risk might be a red flag to the regulatory agencies, the reason…...

The deception of capital expenditure and working capital in business valuation

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The demand for business valuations continues to grow with the improvement of the economy and the rise of baby boomer retirement. Performing high-quality valuations has become more important than ever before to meet client expectations and compete in the industry. To reach the true value of a company, one must have…...

Avoiding the pitfalls of analytical procedures

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By definition, analytical procedures is a process of analytically detecting ways to decrease time and increase efficiency. This process can appear daunting at times because of the numerous comparisons of financial information that must be made when working on a client’s statements. The overall goal for an auditor is to…...

Community bank stress testing: Where to begin

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While banks under $10 billion in assets aren’t technically required to stress test, recent data suggests the practice is becoming the norm. According to the Sageworks 2015 Bank and Credit Union Exam Survey, more than 40 percent of the 180 responding institutions had already begun stress testing, and it was…...

How to build your valuation practice

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Business valuations are one of the fastest-growing services offered by accountants. With a projected growth of nearly three percent each year through 2019, the industry is truly thriving. Much of the demand comes from the shift in business owner demographics as our nation’s baby boomers reach retirement age and step…...

Growing your firm’s advisory services: Financial management

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One of the growing interests for accountants is expanding their firm’s services to include financial advisory. The transition from compliance to consulting makes sense: tax season is just that, a “season,” and nearly 60 percent of respondents to a Sageworks survey indicated they saw an increase in total revenue by…...

Survey: Trends in technology decision-making

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Companies across the globe ask themselves the same question: Is adopting new technology worth it? As you can imagine, this question is not new. Businesses of the past have debated whether or not they should install telephones to connect to customers more easily, use refrigeration to extend shelf life of…...

Technology overload: Which option is the best for me?

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Industry, especially the financial industry, has become packed with insightful and time saving technologies. In a recent Sageworks webinar, 60 percent of attendees said that one of their main road blocks to adopting new technology at their firm was their unfamiliarity with potential solutions. In today’s blog I will map…...

Is your bank prepared to comply? The evolving role of the Chief Risk Officer

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Compliance is often a loaded word for bankers. While regulations within the banking industry are, of course, a necessity, the ongoing conversation about striking a balance between mitigating risk and overregulation continues in government, media and financial institutions themselves. By nature, a bank is set up to withstand some risk.…...

OCC cites loosening of underwriting standards as a top supervisory concern

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On June 30th, the OCC released its Semiannual Risk Perspective for Spring 2015. The report, based on data through the end of 2014, discusses risks facing national banks and federal savings associations, and focuses on issues that pose threats to the safety and soundness of those OCC-regulated institutions. According to…...

Effective LinkedIn strategies for marketing and thought leadership

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Remember the days of the rolodex on your desk? Well, even if you don’t, you probably realize that with today’s digital technology, the rolodex is pretty much extinct. Today, Outlook or Gmail contacts, your phone’s address book and LinkedIn have replaced the reams of paper we once used. You might…...

Engage your market by leveraging technology

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The message of accounting firms has remained relatively the same over the past decade. Offers of insight and ways to generate business growth and increase effectiveness have flooded the market. Though the message has stayed constant, technological improvements have opened the door for firms to reach beyond the borders of…...

How segmentation can benefit a bank’s ALLL and risk management practices

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With increased scrutiny surrounding a financial institution’s ALLL calculation, many are asking how they improve their process and make it more comprehensive. Of course there isn’t any one answer to this question, and the direction can vary based on an institution’s starting point. A segmentation strategy, though, is a great…...

More banks predict larger impact from CECL model

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**The FASB issued the final CECL standard on June 16, 2016. For up-to-date information and resources, access the updated CECL Prep Kit. The attention on the FASB’s current expected credit loss (CECL) model has only increased in recent months, as the industry braces for the release of final guidance before the…...

Happiness and firm efficiency

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Over the past ten years, technological advances have made communications and on-demand services almost necessary for profitably relating to the world. Ultimately, goods and services have become highly customizable, and value propositions are tailored to the individual. These trends are not simply occurring within the consumer marketplace, but also in…...

Can banks have an impact on alleviating the egg shortage?

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If you’re craving an omelet the next time you sit down at your favorite restaurant, you may need to reconsider your order. If eggs are even on the menu at your local haunt, your dish may carry a higher price tag than the last time you dined out. The egg…...

June and July: The months of accounting conferences

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June and July have notoriously been the months that most firms use to attend accounting industry conferences. Though June is coming to a close, it is not too late to think through how your firm may be able to benefit from this time out of the office and away from…...

Video: Introduction to business valuation by Aswath Damodaran

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Aswath Damodaran is a business valuation expert and Professor of Finance at New York University Stern School of Business. In this video, he reviews the importance of valuation and offers three main reasons why valuations fail—bias, uncertainty and complexity. According to Damodaran, human nature and the emotional connection to a…...

NCUA proposed rule: MBL flexibility for credit unions?

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On June 18th, the board of the National Credit Union Administration (NCUA) unanimously approved five items, including a proposed rule aimed at modernizing member business lending (MBL). The rule would provide greater flexibility and autonomy for credit unions to better meet the needs of their members. Small business lending at…...

The benefit of a business philosophy

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In a recent Sageworks webinar, we explored the importance of sole proprietors and small business valuation teams maintaining a strong work and life balance. This balance is, in many ways, the core of their ability to be successful in their work. Like training for a high impact sport such as…...

How to stress test your ag portfolio

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According to recent data, lenders are seeing elevated agricultural loan demand largely as a result of tighter profit margins among producers. The report, from the Federal Reserve Bank of Kansas City, stated that demand could remain high since futures markets for fall crops show prices are likely to remain low…...

Understanding commingled entities through global analysis

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The main philosophy behind a global cash flow (GCF) is to spread all parts of a relationship (people, businesses and related real estate) to measure their financial health and cash flow individually, then collectively on a “global” level. The important take-away here is to try and view individuals, businesses and…...

Survey: 88 percent of people still favor an in-person banking experience

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In late December, CNBC took a peek inside the bank branch of the future. The piece looks at one possibility – a faceless branch, where avatars take the place of tellers. CNBC said in the article, “Community-level banking, particularly from large institutions, will become more cost efficient and less personal.”…...

Summer goals: Improve your audit planning

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Memorial Day unofficially kicked off summer, a time of year that often prompts auditors to begin reflection on what type of accounting firm they want to be. Whether you went on vacation with friends or family for the long holiday or continued to work away in the office, your mind…...

The benefits of building a relationship with your bank examiner

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In a recent Forbes article, Frank Sorrentino, Chairman and CEO of ConnectOne Bank, offered his take on how financial institutions should flip their mindset on regulators and examinations. The piece, titled “Why Banks Should Stop Fighting and Learn To Love Regulators,” suggests that while institutions of all sizes are grappling…...

Credit unions continue to see growth in auto lending

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For more than 30 years, the number one vehicle in America by sales is the Ford F-series line of trucks. More than three-quarters of a million were sold in 2014, continuing its reign as the top vehicle since 1981. The Toyota Camry, the first car on the 2014 list, ranked…...

Approach clients to offer valuation services using these discussion-starters

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By Brad Spence, Director of Sageworks Valuation Solution Most business owners aren’t as lucky as 91-year-old media tycoon Sumner Redstone, who famously declared he won’t discuss succession planning for his Viacom and CBS empires because he isn’t going to die. The fact is, millions of business owners are over age…...

4 Tips for creating an effective credit policy

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Some view banks’ credit policies as somewhat of a necessary evil; many comprise hundreds of difficult-to-decipher pages intended to establish numerous policies for evaluating and undertaking risk. These credit policies outline banks’ appetite for risk, establish banks’ credit culture, determine the extent of decision-making delegation and describe how loan portfolio…...

How will the Apple Watch and other tech evolutions impact banking?

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That five-inch screen is ready to move to your wrist, and, perhaps surprisingly, that affects a lot more than just your wallet.  It’s not just the technology industry that is constantly evolving – many other industries must also remain adaptable to the changing landscape of the American consumer. One such…...

What to consider when pricing business valuations

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A recent survey by Pepperdine University found that 64 percent of business owners intend to transfer their ownership interests within the next 10 years. For those considering selling their business, a valuation professional could be seen as friend or foe – either delivering the good news that their business is…...

Yelp for accountants: What your online reputation can mean for new business

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With more than 142 million users per month and 77 million local reviews, you’ve likely used Yelp’s website or mobile app to source a great Italian restaurant or locate the nearest bakery when you’re craving something sweet. But the review-based community extends far beyond ravioli and cannoli. Just about any…...

3 scenarios that demand a valuation professional

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While business owners are the captains of the ship, in many cases they operate leanly -- with a small crew or perhaps no crew at all. With more than 70 percent of all businesses in the U.S. owned by sole proprietors, a significant number of people control their professional destiny,…...

Top questions on global cash flow and pass-through entities

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One of the more challenging components of tax return analysis is analyzing global cash flow with multiple pass-through entities – especially without double-counting or leaving cash flow out. Linda Keith, president of Linda Keith CPA, recently partnered with Sageworks to lead a webinar aimed at clarifying the confusion on pass-through…...

As baby boomers age, valuation professionals adapt to help close “value gap”

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Written by Zeb Zilar, Project Lead, Sageworks Valuation Solution Baby boomers are hitting age 65 at a rate of 10,000 a day until 2030, according to the Pew Research Center. Another study showed that 65 percent of new business sellers in Q1 of 2014 were baby boomers.  The transfer of wealth that…...

Standardizing analytical procedures to bolster audit compliance, efficiency

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By Michael Sferratore, Vice President of ProfitCents One of the unintended consequences of auditing changes in the wake of accounting scandals since Enron and WorldCom is that some investors and regulators have come to believe that accounting can be an exact discipline – where objective practitioners uncover “the truth” by…...

Creating repeat valuation and consulting work: Optimize value of clients’ businesses

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Business appraisers have an excellent vantage point to see deep into the workings of a business in the process of doing their appraisal. They can then offer their insights to owners who would like to increase the value of their business. A home is a useful metaphor for valuation professionals…...

Shoot and score: Tips for winning a new business valuation client

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If you’re a sports basketball fan, you know that the NBA playoff matchups are underway. As it stands, the average field goal percentage for the current season is .449. Of all 30 NBA teams – from first place standing in the Eastern Conference to last place in the West –…...

3 Accounting clients who need a ProfitCents report

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A lot of new ProfitCents customers understandably want to get the most out of the solution without devoting a ton of time in order to ramp up. One of the first steps in making sure you generate an acceptable return on your investment is to identify quickly a small number…...

3 Common loan review weaknesses

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Loan review is a periodic review of bank and credit union loan portfolios in order to gauge their overall risk profiles. The assessment of loan portfolio quality is then provided to senior management and the board of directors. This assessment often provides an early warning of deterioration(s) in credit quality…...

Leverage social media to market business valuation services

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Much like peanut butter and jelly, social media and content marketing are two things that go together in the world of forward-thinking marketers and business owners. So how does a firm get started using social media to build their valuation practice? Given the competing pressures on business valuation professionals or…...

Beyond efficiency: Using technology to ramp up a valuation business

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By Brad Spence, Director of Sageworks Valuation Solution What drives new business for your valuation practice? Referrals? Marketing? Cross-selling current accounting clients? How about technology? Is your firm using technology to drive new valuation engagements?  Many accounting firms view technology expenses as overhead – costs that chew up precious revenue dollars…...

Lessons to apply to business valuations

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By Bakley Smith, CFA Most business owners - especially those in the startup space - have an eye on valuation. At what level does the market value the company? The media, of course, feeds the frenzy with television shows, articles, podcasts and a steady stream of click bait, aimed at…...

What can your firm learn from busy season?

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Get ready to breathe a sigh of relief… you’ve almost made it to the end of busy season. If your Twitter feed has consistently seen nothing but #busyseasonproblems for the last few months, it’s nearly time to make them a distant memory (but admit that you’ll miss the comic relief).…...

3 Easy steps to get the most out of ProfitCents

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In working day in and day out with accountants, we often hear that a main reason people subscribe to ProfitCents is to provide additional value to their clients. Accountants want to be able to help clients understand what their financial statements mean in the context of: • How the business…...

How to simplify valuation report writing

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When confronted with multiple clients, each requiring days of your time or your employees’ time to produce a customized valuation report, it is common to ask: How can I make this process easier? How can I make this process more productive for my bottom line?  In speaking with financial professionals…...

What data is needed for top down stress testing?

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The OCC defines “top down” stress testing as “applying estimated stress loss rates under one or more scenarios to pools of loans with common risk characteristics.” This method of stress testing provides deeper insight into a financial institution’s portfolio or portfolio segment during stressed scenarios. For top down stress testing…...

Top cash flow forecasting mistakes

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By Bakley Smith, CFA Strong businesses have a solid handle on their financial reality, and the cash flow statement is an excellent, if not the best, measure of a company’s ability to generate cash in excess of cash invested. Over a sufficiently long period of time, all businesses have to…...

Find out what other institutions hear during exams

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Few bankers enjoy having a federal examiner onsite, conducting a safety and soundness examination. It can lead to bottlenecks, additional reports that must be prepared, lost focus for bank or credit union executives, stress for board members and, in some situations, a bad report from examiners. How can you cheat…...

What Basel says about expected credit loss

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The phrase “expected credit loss” (ECL) is one that bankers will be hearing a lot more of in the coming months. Currently, financial institutions adhere to the incurred loss model for their allowance for loan and lease losses (ALLL). However, final guidance on the FASB's Current Expected Credit Loss (CECL)…...

How can bank boards respond to increased regulatory scrutiny?

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Bank directors have always played a critical role in ensuring the success of their institution. Unfortunately, the recent economic crisis highlighted shortcomings in boards’ understanding of risks and the proper oversight of those risks. This may have been due to some directors lacking experience and/or being too closely tied to…...

The madness of March: Busy season edition

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Someecard created by Whitney2327585 If you’re an accountant, a CPA or an auditor, March may very well be the most grueling month of the year. You’re probably up to your ears in #busyseasonproblems like being overloaded on caffeine, working on little sleep, and jealousy for missing out on the college…...

Business, marital disputes fuel valuation demand

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By Brad Spence, Director of Valuation Solutions, Sageworks Accountants considering adding or expanding valuation services in their practice may wonder about the demand for valuation services and what kind of clients can benefit from a valuation or calculation engagement. According to valuation and forensic specialists queried in the 2014 AICPA…...

Are you diversifying your portfolio appropriately?

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It is only natural for community banks to have loan concentrations that result from the market(s) they serve and the markets they pursue. In today’s times, a high commercial real estate (CRE) concentration is often the result of community banks pursuing opportunity in the market. Consequently, interagency guidance on CRE…...

Which are America’s healthiest banks?

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In the last several years following the Great Recession, the health of banks in the U.S. has been analyzed and debated.  For the largest of American financial institutions – those that much of the public banks with for checking, mortgages and auto loans – stress testing regulations have been passed…...

Valuation vs. calculation engagements: What’s the difference?

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By Brad Spence, Director of Valuation Solutions, Sageworks Accountants, other professionals and their clients encounter many circumstances that may generate the need for an appraisal of a business or part of a business: • Divorce • Tax planning • Buy-side due diligence on a merger or acquisition or sell-side advice…...

How to improve your relationship-based banking

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According to the latest FDIC Quarterly Banking Profile, community banks continue to thrive and lead the industry. As more banks turn profitable – 90.3 percent achieved that threshold in the fourth quarter of 2014 – they aren’t just competing with large, national banks; their community bank counterparts also account for…...

4 Traits of quality industry data for valuing a business

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By Erik Lively, Regional Valuation Consultant, Sageworks Accountants and other financial professionals know that the quality of industry data can make a substantial difference in business valuation services, whether it’s for a valuation engagement or for a calculated value to help develop a business improvement plan. Good industry data can…...

Do you have 99 #busyseasonproblems?

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Tax and audit season got you down? For all in the accounting industry, it’s the time of year that means longer days, pots of coffee, and staring at spreadsheets and W-2 forms ad nauseam. You may be teetering dangerously close to the point of sleeping under your desk at night.…...

Community banks’ net income, loan balances increase in 2014

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The latest FDIC Quarterly Banking Profile was just released and the industry continues to be led by the nation’s community banks. The positive trends from the third quarter of 2014 continued for the industry sub-set. Net income was up almost 28% over the fourth quarter of 2013 led by higher…...

Stressing the importance of stress tests

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March comes in like a lion for the nation’s largest banks. Yesterday the Federal Reserve announced how “the big banks” fared on their annual stress tests (The Wall Street Journal’s Briefly blog offers what to know and what is relevant about the exams). The reports were positive: all 31 stressed…...

Making your lending process efficient

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For most banks and credit unions, a current strategic focus is loan growth – increasing the portfolio by both acquiring new borrowers and expanding services offered to existing borrowers. In this competitive environment, to win prospective loans, regardless of whether it is a new or existing borrower, the institution has…...

Business valuations as performance dashboards for accounting clients

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  By Brad Spence, Director of Enterprise & Valuation Teams, Sageworks Many accountants are exploring opportunities to add business valuations to their menu of client services, especially as valuation demand increases and as these professionals understand valuations can generate higher profits than traditional accounting services. Offering advisory services like valuation…...

6 Ways to Improve Profitability of Plumbing Businesses

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When a plumbing business becomes more profitable, it is able to expand its offerings and attract more customers. Taking some of the following simple steps into consideration to improve profitability may give a business an edge against competitors and help make it more successful. GPS Tracking Try utilizing GPS tracking if…...

OCC warns against lax auto loan standards

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The U.S. auto industry is booming. According to Federal Reserve Economic Data (FRED), total light weight vehicle sales rose to 16.6 million in January 2015, from 15.2 million the year prior. Unsurprisingly, the sales growth also increased demand for auto loans at domestic banks. FRED reports that 25.4 percent of…...

What is your accounting firm’s plan post-tax season?

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With spring comes the promise of warmer temperatures, irises and snapdragons, along with March Madness college basketball rivalries and the start of baseball season. While tax accountants may not be able to see the light at the end of the busy season tunnel yet, the spring is sure to come.…...

Business valuation methods matter

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By Brad Spence, Director of Enterprise & Valuation Teams, Sageworks Think performing quality business valuations is important? Consider this statistic: Roughly one in every three business-sale engagements for brokers over the last 12 months ended without a transaction, and unrealistic asking prices were a major factor in the failed deals,…...

Auto lending up more than 30 percent at credit unions since 2012

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It may still be early in the New Year, but the U.S. economy is looking promising for 2015. A resurgent job market (with 257,000 U.S. jobs added in January, following two very strong months in November and December) is most telling, and leaving many Americans with smiles on their faces.…...

Professional standards and business valuations

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By Brad Spence, Director of Enterprise & Valuation Teams, Sageworks Standards – whether they relate to academics, safety or business practices – help people identify acceptable levels of quality, and standards are used in nearly all aspects of our lives. Without standards, for example, it’d be harder to tell whether…...

Which loan types are fueling bank growth?

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Following the recent recession, U.S. commercial bank loan portfolios have continued to expand. As of the third quarter of 2014, the total value of portfolios was $7.4 trillion, up from $6.5 trillion at the end of the third quarter of 2011. Which areas of lending and what banks are driving…...

Trend analysis within your Watch List

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A standard component of monthly board meetings is an update on the performance and volume of the institution’s Watch List, the group of adversely classified loans under close supervision due to past nonperformance. Oftentimes, the Watch List includes loans rated as a (low) Pass, Special Mention, or Substandard, though in…...

Stop creating “Frankenstein” business valuation reports

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By Mike McCaffery, Regional Consultant – Valuation Solutions, Sageworks Business valuation professionals know that writing the report is a major component of performing valuations.  For one thing, valuation analysts spend a lot of time on each report. In fact, writing the report is the most time-consuming part of the process…...

How to reduce professional liability risk when performing valuations

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By Brad Spence, Director of Valuation Solutions, Sageworks   Remember the old saying, “Make hay while the sun shines”? It’s a good reminder that one should take advantage of opportunities while they’re available. Valuation services represent one good opportunity for growth that many accountants recognize and are taking steps to…...

Key components of credit risk rating systems

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One of the most popular tools to monitor credit risk is a standardized risk rating system. A credit risk rating system provides banks and credit unions the opportunity to grade transactions in their commercial loan portfolio by level of risk. CEIS Review, a New York-based bank consulting firm, recently published…...

Infographic: 4 Ways to Improve Landscaping Sales

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It is important for a landscaping business to find the best way to differentiate themselves from others in the industry in order to remain competitive in the marketplace. Finding quick ways to increase profitability can be tough, but the infographic below details 4 easy ways to increase revenue by improving…...

What 2015 holds for banking

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The IBM Institute for Business Value released its 2015 report, “The paradox of Banking”, which analyzes the existing market and makes predictions about how the landscape will evolve, what will make banks succeed or fail and how institutions can use the market trends to their advantage. While the report recognizes…...

Three ways to keep your best employees from leaving your firm

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Posted by Sageworks

A few decades ago, it was fairly common for a person to secure a job immediately following graduation from school and remain with the company until retirement. Those days are gone, and now, hanging on to top talent is a significant concern for most employers. In October, PayScale, the online…...

Top benefits of ALLL scenario building

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Posted by Sageworks

Though it may be often overlooked, scenario planning allows bankers to assess the outcome of the ALLL calculation under various assumptions or “scenarios.” Bankers can then estimate the impact that ALLL-calculation variables may have on the final reserve without having to perform a completely new calculation. The process can be…...

Will the cost of regulation impact community bank customers?

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The banking industry has seen a steady stream of media attention since 2008, much of it in the form of stories about data breaches linked to major retailers or mega banks’ profits. For most consumers who have a checking account, savings account and maybe a mortgage, the regulations placed on…...

How to get referrals and grow your firm

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By Natasha Closs, Director of ProfitCents Consulting & Advisory Services An ongoing challenge for accountants and other financial services professionals is attracting new clients. In fact, bringing in new clients is at or near the top of the list of challenges facing accounting firms of all sizes, and it’s a…...

Business valuation solutions: To build or to buy?

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By Brad Spence, Director of Sageworks Valuation Solution It’s a classic conundrum – to build versus to buy. Make dinner at home versus take-out. While there are certainly people constructing their own coffee table – measuring, cutting, sanding and staining – most will drop a bill or two on a…...

Sageworks to host 2015 Risk Management Summit in Chicago

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Posted by Sageworks

Following three successful years in Nashville, Tennessee, the 2015 Risk Management Summit heads to a new city this September. Bank and credit union executives and leading industry experts will convene September 23-25 in Chicago, Illinois, for the premier banking conference covering the ALLL and stress testing. Given pending changes to…...

Community banks most likely to approve small business loans

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According to a recent survey from four Federal Reserve Banks, small regional and community banks have the highest approval rate for small business loans. Over the first half of 2014, these banks, with an approval rate of just under 60 percent, beat out large national banks (31 percent), large regional…...

The war for wallets: CU Wallet to debut this year

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The world is increasingly digital. Favorite songs, memorable moments and solitaire are all housed on a small, thin rectangle likely tucked away in a pocket. The techies and bankers alike knew that a mobile wallet was next. And why shouldn’t it be? Peek inside nearly any brick-and-mortar retailer and you’ll…...

How to increase revenue this busy season without adding clients

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By Natasha L. Closs, Director of ProfitCents Consulting & Advisory Services To increase revenue, your accounting firm either needs to add clients or boost prices, right?  Those are certainly two options for accountants looking to have a better busy season than last year. Taking either of these approaches, however, could…...

Defending the bank’s capital levels

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The Recession and its subsequent rate of bank failures underscore the need for banks of all sizes to invest in developing a capital plan. The Recession taught many institutions that whatever processes had been in place for managing capital were not sufficient. Often, they either failed to include forward-looking analyses,…...

Growing a mortgage portfolio: Encourage borrowers to bank local

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Finding one’s dream home can be a tedious, lengthy process. Financing it can feel even more cumbersome for many homebuyers. There are a lot of options on the table for mortgage applicants, and sometimes comparing interest rates and conditions can feel overwhelming, particularly for first-time homebuyers. Interestingly, the Consumer Financial…...

New rules on cybersecurity, MBLs considered by NCUA for 2015

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During an October 2014 NCUA examination of Palm Springs Federal Credit Union (FCU), a confidential flash drive went missing. According to Palm Springs FCU President & CEO Debbi Pitigliano, the drive was provided to the NCUA and contained members’ personal information, including names, addresses and social security numbers. Since last…...

How much should you segment FAS 5 (ASC 450-20) pools?

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The benefits of segmentation within the Allowance for Loan and Lease Loss calculation are many. Institutions can gain more insight into sub-segmented performance, conduct more sophisticated loss methodologies such as migration analysis and can make better-informed lending decisions over time. However, as the old adage goes, there certainly can be…...

How to transition your accounting firm from compliance mode to consultant mode

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An accountant's workload is much more than just tax preparation and number crunching. According to a 2014 IBISWorld report, financially-cognizant companies are increasingly turning to their accounting firms for advice on how to reduce inefficiencies in daily operations and eliminate unnecessary costs. Because accountants are among the most trusted business…...

5 Questions accountants can ask to deepen client relationships during tax season

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At the height of tax season one problem accountants often face is maximizing their client meetings. When an entire firm – and entire industry, for that matter – is racing against the clock and aims to pack as much into each day as possible, it is natural for even the…...

3 Percent down payments and risk to lenders

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Many would point to imprudent lending standards as a leading cause of the financial crisis of 2008, and in turn, financial institution regulators have since bolstered lending standards and capital thresholds as a preventive measure against a similar crisis. But recent news from Fannie Mae and Freddie Mac might suggest…...

Expanding credit portfolios: 3 Growing pains

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Community banks are expanding their loan portfolios to include more small business loans, according to the most recent Community Bank Performance report by the FDIC. Loans across categories increased, with commercial and industrial loans growing at the fastest rate, roughly 5.3 percent over the 3rd quarter of 2013. These expansions…...

What to get for the accountant who has everything

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The “most wonderful time of the year” is officially in hyper drive. The hand-print turkeys are now a distant memory and you’ve fought your way out of the Thanksgiving food coma. Before you know it, you’ll be ringing in 2015 and busy season will have you funneling coffee instead of…...

How to cross-sell additional accounting services with ProfitCents

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Clients of accounting services hold their accountants as one of their most trusted business advisors. This high level of confidence positions you, as a CPA, in a role where you can offer services beyond commodities such as bookkeeping and tax preparation. In a recent case study, Sageworks’ customer Mueller Prost…...

How to validate a stress test model

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The prevalence of stress testing within banks and credit unions has risen considerably in recent periods thanks to increased regulatory attention and the benefit of greater insight into financial institutions’ portfolios. While there aren’t set requirements in place for those under $10 billion in assets, interagency expectations have been set…...

Best banks to work for in the U.S.

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Do you work at one of the best banks in the country? American Banker just released its second annual ranking of the best banks to work for in the U.S. The rankings are based on employee opinions of the work environment, benefits, career-advancement opportunities and perks such as subsidized gym…...

3 Global cash flow analysis tips

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With an improving economic environment, many banks are seeing strong loan growth. In fact, a recent report from the OCC highlighted the fact that loan growth doubled over the past year in the Northeastern district. However, it is important for institutions to remain disciplined during this growth, all the way…...

How to embrace technology and grow your accounting firm

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Forty-five percent of accounting clients prefer an accountant who is adaptive to changes in technology. While technology has its fair share of shortcomings, from added costs to potential learning curves, it also has its upsides. Embracing and leveraging technology can help accountants discover new avenues for improving lead generation, increasing…...

How accountants can identify opportunities to offer valuation services

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With an estimated 75 million baby boomers in the U.S. and 7 million of them owning privately held businesses, the number of companies to hit the market in the next 10 years is likely to provide a large amount of opportunities for the valuation industry. This checklist provides 10 scenarios…...

The role of self-assessment in board meetings

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Every bank has a board of directors, with each member providing his or her experience and expertise to develop strategic plans and enhance the institution as a whole. According to the FDIC, the Board’s role includes: • Selection, monitoring and evaluation of management • Establishment of business strategies and policies…...

Does your bank communicate effectively with loan customers?

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Posted by Sageworks

Being an effective communicator is something that many people struggle with every day. Irish playwright George Bernard Shaw once said that, “the single biggest problem in communication is the illusion that it has taken place.” Upon reading that, there are likely many people nodding their heads. But communication is not…...

Guest blog post: Protecting yourself online

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The majority of professionals love technology. It makes not only your personal life easier, but running your small business or CPA firm, too. But when is too much technology just too much? Sageworks asked Don West, a member of the AICPA's Information Management and Technology Assurance Section's CITP Credential Committee…...

Caution! 3 Blood-curdling ways to stop your accounting firm’s growth dead in its tracks

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Posted by Sageworks

1. Be eerily similar to your competitors Many accountants will come to the spooky realization that firms who compete in the same market will likely have the same basic offerings, mostly because accounting services are pretty standard across the board. And while your firm’s qualifications and experience may be fantastic, the…...

Poll: 36% of finance professionals send clients to a third party for business valuation services

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Posted by Sageworks

During a recent webinar on how to prepare for booming growth in the valuation industry, Sageworks polled over 135 finance professionals and found that more than 35 percent are sending their clients to a third party to complete a business valuation.     During the webinar, Paul Wapner, CPA/ABV, CGMA,…...

The importance of balancing loan portfolio growth and risk management

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Posted by Sageworks

U.S. banks are seeing low loss rates on CRE and construction loans relative to the past six years, according to Forbes. As a result, many are seeking growth in these areas, and others, as the recent financial crisis falls into the more distant past. But how can this growth be…...

Establishing a project management culture

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Posted by Sageworks

Among the various characteristics that make up a company’s culture, one of the most important aspects often goes overlooked. Ancin Cooley, principal of Synergy Bank Consulting, Inc. states that a mix of value-based cultures is pivotal in the effective management of a bank. A sound project management culture, Cooley argues,…...

How one accounting firm used ProfitCents to show clients the importance of value-added services

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Nearly every firm has business clients who are interested in more services from their accountant. Almost two-thirds of clients are unaware of all services their accounting firm has to offer. Cross-selling value-added services will not only help you retain your current clients but also grow your business’s revenue. In a…...

The 8 questions to picking an accounting niche

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Posted by Sageworks

Consumers understand that certain retailers specialize in particular items. If you're looking to plant tomatoes in your garden, your first step is unlikely to visit the local Best Buy store. Sometimes a specialty retailer is necessary to meet your needs. Such can also be the case with accountants. A one-size-fits…...

3rd annual Risk Management Summit proves “valuable” and “insightful”

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More than 140 bankers and industry experts from over 30 states gathered in Nashville, Tennessee last month for the 3rd annual Risk Management Summit hosted by Sageworks. Building on the success of the 2nd annual Summit, this year’s event featured new topics, new speakers and additional networking opportunities. Maintaining a…...

Poll: Are your staff members aware of what makes your accounting firm different from the competition?

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Posted by Sageworks

During last month’s webinar, How to Create and Implement a Marketing Plan in Your firm, speaker Bonnie Buol Ruszczyk, president of bbr marketing, discussed a number of tactics accountants can use to establish a marketing strategy for their firm. Bonnie shared how having a plan in place allows accountants to…...

Thought starter: Top challenges accountants face and actionable ideas to solve them

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Posted by Sageworks

Comedian and television writer/producer Larry David has said, “I'm not a person who embraces challenges. I run from challenges. I break world records running from challenges.” Humor aside, accountants don’t have the luxury of thinking that way. While accounting was identified as the most profitable industry of the last 12…...

How to prepare for Basel III

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Posted by Sageworks

Following the recent financial crisis, the Basel Committee of Banking Supervision (BCBS) set out to “strengthen global capital and liquidity rules with the goal of promoting a more resilient banking sector.” With the release of Basel III, the Committee is building on Basel II’s three pillars and strengthening them. The…...

3 ways for community banks to capitalize on the “buy local” movement

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Posted by Sageworks

Wal-Mart, McDonalds, Home Depot. These large corporations are found in almost every town in America. While many consumers choose to take advantage of their less expensive product offerings, a culture shift is starting to take place. Today’s youth and others across all age groups are placing a significant importance on…...

Why your accounting firm should have a retention strategy

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Posted by Sageworks

It is estimated that 40 percent of accounting clients are interested in new services from their accountant. Learn how you can increase your client’s awareness about your firm’s service offerings, potentially resulting in more revenue and happier clients. Download this infographic     Winning new clients is a top priority…...

Does bigger mean more efficient?

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Posted by Sageworks

With size comes economies of scale. Larger institutions can “scale” to meet challenges that many smaller institutions find hard to handle. Being better equipped to meet regulatory demand comes to mind amidst other advantages: marquee clients, specialized positions, brand recognition, etc. A recent post by Jeff Marisco, author of Jeff…...

3 Steps to becoming the Steve Jobs of accounting

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Steve Jobs. Sergey Brin. Mark Zuckerberg. Each of these individuals, and their companies, are celebrated as changing the face of the technology. They all followed a similar path to success: excelling at one thing and developing that specialty. Jobs knew gadgets, which led to the Mac, the iPod, and the…...

Poll: Does your firm have a formal marketing plan in place?

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Posted by Sageworks

ProfitCents by Sageworks recently hosted a webinar on How to Create and Implement a Marketing Plan in Your Firm.  Bonnie Buol Ruszczyk, president of bbr marketing, discussed strategies for developing a marketing road map to to attract the clients that will be most valuable for your firm. During the presentation,…...

How to manage the risk of commercial real estate lending

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Posted by Sageworks

As banks are increasingly playing a bigger role in commercial real estate lending, it is more important than ever to ensure proper risk management practices. This is especially true for banks exceeding one or both of the commercial real estate (CRE) supervisory criteria. According to recent data generated by Sageworks…...

How one accounting firm used ProfitCents reports to retain a client

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Identifying improvements a client can make to their business should be part of an accountant’s regular routine, but getting the client to actually take the necessary steps to implement these opportunities can be a challenge. Accountants can use resources such as ProfitCents reports to help bridge the gap with clients…...

2014 trends in compliance risk management for banks

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Posted by Sageworks

Because of new regulations in the banking industry, compliance risk management is becoming increasingly important for bank management. The Accenture 2014 Compliance Risk Study confirms this theory and identifies five, key trends that have accordingly surfaced in banking. 1. Compliance programs are constantly evolving. 2. To achieve strategic goals, further…...

Is your ALLL prepared for the future?

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Posted by Sageworks

Given all the attention the allowance for loan and lease losses (ALLL) is receiving from regulators and FASB, it is important to understand how banks and credit unions will be impacted in the short, mid and long-term by regulatory changes. It is also critical for bankers to understand what they…...

An accounting firm’s checklist for attracting and keeping talented team members

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Posted by Sageworks

Finding and retaining qualified staff is a top concern among accounting firms, according to the AICPA. Establishing a plan to recruit and develop staff in your firm will help you attract and keep top-notch employees. This checklist provides 4 steps you can take to win and retain talented team members.…...

How to present stress test results to the bank Board: Part II

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Posted by Sageworks

Yesterday’s article examined the importance of presenting actionable stress test results to the Board, as well as how to structure the Executive Summary of a stress test analysis. This article focuses on the remainder of the presentation, beginning with a section on local and national conditions. After the Executive Summary,…...

How to present stress test results to the bank Board: Part I

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Posted by Sageworks

As part of a series, this article focuses on communicating actionable stress test results to a bank or credit union board of directors, as well as how to structure the executive summary. Part II will focus on the remainder of the presentation including local and national conditions, methodology, and results.…...

How are banks performing ALLL model validations?

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Posted by Sageworks

With increased examiner scrutiny around the allowance for loan and lease losses (ALLL) and the expected release of FASB’s CECL model, banks and credit unions are feeling additional pressure to have their ALLL models validated. The release of guidance on model risk management by the Federal Reserve and the OCC…...

How to help your bank stand out from the crowd

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Posted by Sageworks

In a recent post on American Banker, Bill Early, president and mortgage lender of PlumDog Financial, argues that banks need to be more like carrots. He isn’t talking about painting the walls orange, but rather transforming the banking industry to become more client focused.   Early notes carrot consumption in…...

6 Steps accounting firms can take to win new clients through specialization

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Posted by Sageworks

Lack of industry knowledge is the #1 concern for buyers of accounting services according to a Hinge Marketing survey. Developing an industry niche and establishing yourself as an industry expert allows you to differentiate your services and can help you win new clients. This checklist outlines 6 steps on how…...

Poll: How much is thought leadership and content marketing used at your firm?

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Posted by Sageworks

ProfitCents by Sageworks recently hosted a webinar, Content Marketing Strategies, which discussed how to effectively implement and use thought leadership in your accounting firm. Rob Nance, director of content marketing & consulting services at Inovautus Consulting, explained ways to overcome the most common challenges in creating thought leadership. During the…...

3 Common ALLL model validation questions

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Posted by Sageworks

Scrutiny around the allowance for loan and lease losses (ALLL) by regulators has grown in recent years since many banks and credit unions did not properly increase their reserve to reflect increases in charge-offs and deterioration in loan portfolios leading up to the economic crisis. Since then, banks and credit…...

Take your relationship with your accountant to the next level

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Posted by Sageworks

By Diana Mackie, Chief Content Officer at Funding Gates How well do you and your company’s accountant know one another? Do you hand him or her a pile of papers come tax time and go about your day, or do you appreciate and make use of the wide range of…...

How to stress your CRE portfolio

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Posted by Sageworks

Many banks are familiar with top-down stress tests, as these tests may not necessarily require the use of a sophisticated model and there is an accepted way to implement the tests. Bottom-up stress testing, however, is not as clearly defined by guidance and is often left up to the institution…...

Establish a strategy for cross-selling your accounting firm’s services

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Posted by Sageworks

The AICPA estimates that winning a new client costs 11 times more than retaining a current client. One way for accountants to increase firm revenue and deepen client relationships is to offer value-added services to existing clients. Don’t know where to start? Download this checklist to learn how to develop…...

How to use stress testing as a tool for risk management

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Posted by Sageworks

By now, we should all be familiar with the term “stress testing.” And while stress testing is not a new concept – it is an important part of the risk management process for every institution. Recent mandates from regulatory bodies have placed a renewed emphasis on it. Most institutions perform…...

6 Reasons why your accounting firm should establish an industry niche

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Posted by Sageworks

Thirty-five percent of buyers for accounting services use expertise and specialization as a deciding factor when selecting a firm. Benefits to developing a firm focus include establishing a competitive edge in the marketplace, building your accounting practice’s credibility and winning and retaining more clients. Download this infographic to learn the…...

How one firm used ProfitCents to win a new accounting client

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Posted by Sageworks

Many accountants find it challenging and are not sure how to start developing an industry focus for their firm. In a recent case study, Sageworks’ client MiddletonRaines + Zapata, a growing Houston-based accounting firm, shared how they attracted and won numerous engagements by establishing an industry niche with the help…...

Shrinking ALLL reserves means no more “lazy” lending…in theory

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Posted by Sageworks

Though the last half decade has been rather tumultuous, recent bank metrics released by the Federal Reserve indicate improving credit quality. One of the most notable metrics is the average Loan Loss Reserve ratio. This ratio, which from 2010 to 2014 has shrunk over 200 percent, measures the amount of the…...

How to retain “A” clients

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Posted by Sageworks

In an economic climate where so many decisions come down to dollars and cents – particularly for small businesses – it is important for accountants to illustrate your worth. Perhaps surprisingly, then, more often than not, a client’s decision to leave their current CPA or accounting firm comes not from…...

How to calculate risk ratings for different loan types

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Posted by Sageworks

While the specific criteria and related weightings of risk rating factors differ by institution, generally, the 5 C’s of Credit are used to drive these risk rating factors. The 5 C’s include: character, capacity, capital, conditions and collateral: • Character: What is the character of the borrower? This is where…...

Are you focusing more on risk management than your actual job function?

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Posted by Sageworks

According to the ABA Banking Journal, risk assessment is a trending topic and could grow out of hand if it detracts from other bank priorities. Risk assessments can be a lengthy, complex and ongoing process, which makes it difficult to discern when you should focus on managing risk and when…...

How accountants can cross-sell their services to existing clients

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Posted by Sageworks

Successful accountants can generate more revenue while keeping costs down by creating new business from their existing clients. The AICPA estimates that it costs 11 times more to acquire a new customer than to keep an existing one. This infographic will give you key steps to keep clients coming back…...

Why yesterday was huge for banking: IFRS 9

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Posted by Sageworks

Despite much deliberation and an initial desire to converge ideologies, the International Accounting Standards Board (IASB) and its American counterpart, the Financial Accounting Standards Board (FASB) were unable to draft uniform revisions to the current incurred loss model for the ALLL. Due to fundamental disagreements on how impairments should be…...

Why do banks maintain an unallocated reserve?

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Posted by Sageworks

The unallocated reserve can play an important role in maintaining a financial institution’s overall reserve; however, it is, by nature, a rather subjective process. Unallocated reserves are the result of an adjustment to account for estimated credit losses which fall outside of the predefined qualitative factors and historic loss calculations.…...

Increasing interest in MBL for credit unions

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Posted by Sageworks

As credit unions continue to experience solid growth in traditional lending areas, many management teams are focusing attention on starting or expanding their member business lending program. Growing the business portfolio can provide a number of benefits for credit unions, including: • Diversifying the balance sheet and revenue streams, •…...

Why U.K. accountancy pros use ProfitCents

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Posted by Sageworks

Accountancy professionals aim to have the expertise and tools to address customer needs, but this can be difficult, given the many demands on firms. That is why accountants in the U.K. who are looking to win new clients and increase engagements use ProfitCents, the leading solution for analysing small- and…...

How accountants can win new clients

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Posted by Sageworks

Accounting firms oftentimes abandon a marketing plan for fear they don’t have the budget to successfully win new clients. This checklist provides 9 steps to create a plan of action to win new clients at low-cost.     Download this checklist to learn the six key questions accountants can ask that…...

7 Questions successful accountants ask during client meetings

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Posted by Sageworks

It's important for accountants to have a list of key questions to use during client meetings to deepen relationships. This checklist can provide a wealth of benefits including better understanding of client challenges and highlighting opportunities to cross-sell accounting services. Download this checklist to learn questions you can ask that will…...

Does your institution currently have an effective risk rating system?

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Posted by Sageworks

During a banking industry webinar, Chuck Nwokocha, senior risk management consultant at Sageworks, discussed what is required to increase credit quality in a bank or credit union. And a requirement for those improvements is a working and effective risk rating system that is applied uniformly by different analysts at the…...

How to use stress testing results to your advantage

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Posted by Sageworks

As stress testing has increasingly become a focus of regulatory guidance, it is important to understand its purpose and methodologies, but also how to use the findings to your advantage. This post provides five ways to use stress testing results to benefit your bank or credit union. 1. Ward off…...

Sageworks and Crowe Horwath to host webinar on ALLL model validation

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Posted by Sageworks

In recent years, scrutiny around the ALLL by regulators and auditors has grown, as many banks and credit unions failed to increase their reserve to reflect increases in charge-offs and deterioration in loan portfolios during the economic crisis. Since then, many institutions have revised existing models or implemented new models…...

Defining risk through CRE bottom up stress tests

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Posted by Sageworks

A bottom-up stress test is one in which the financial institution uses loan-level data from a sample of the portfolio to gauge the potential impact of a stress scenario on the institution’s earnings and capital. Once the sample has been selected—typically a portion of the CRE portfolio—the institution applies a…...

How to create lasting client relationships in your accounting firm

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Posted by Sageworks

Relationships with accounting clients require trust, communication and understanding. Creating real relationships is key to maintaining the prosperity of your firm. This infographic will share ways to create, maintain and move these relationships to the next level.     Download this infographic to learn 9 traits that will transform relationships…...

The role of management and the board with the ALLL

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Posted by Sageworks

Guidance states that it is the responsibility of a bank’s management team and Board to ensure an adequate ALLL level as part of the institution’s safety and soundness. That responsibility includes several specific components as outlined in the Federal Reserve’s Commercial Bank Examination Manual.  Bank management is expected to outline…...

Greatest risk to your bank

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Posted by Sageworks

In light of the improved financial and credit conditions in which banks and credit unions find themselves today, the current lending market might seem rosy. But that’s not to say bankers are ignoring variables in the lending equation that might introduce vulnerabilities into the institution. Through a recent survey of…...

Accounting for purchased loans: How to determine the appropriate standard

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Posted by Sageworks

In light of record-high at-risk bank figures, increasing regulatory pressures, a low-interest rate environment and the continued struggle for capital, many banks have, and are continuing to seek increased growth via mergers and acquisitions. The acquisition of loan portfolios, particularly those of failed institutions or those succumbing to the aforementioned…...

Growing CRE: Cause for concern?

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Posted by Sageworks

With the help of Synergy Bank Consulting, Sageworks recently surveyed a host of community banks and credit unions regarding areas of growth in their institutions. Emerging from the financial crisis of recent years, the overwhelming majority of growth was in commercial real estate (CRE), as opposed to other areas like…...

4 Emerging risk management best practices

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Posted by Sageworks

As the first half of 2014 comes to a close, many bankers continue to face challenges to grow their loan portfolios and comply with ongoing regulatory changes. But there are ways bankers can reduce risk and examiner criticism, according to four industry experts participating in the 3rd Annual Risk Management…...

ProfitCents U.K. enhances industry benchmarking

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Posted by Sageworks

Sageworks, the maker of ProfitCents, has enhanced its ProfitCents U.K. platform to add real-time industry averages so that accountancy firms across the U.K. can show clients the most up-to-date and accurate trends in their industries. Providing these types of value-added services can help accountancy firms win and retain more clients. …...

Full agenda for 3rd annual Risk Management Summit released

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Posted by Sageworks

Sageworks recently released the full agenda for the 3rd annual Risk Management Summit, which will be held September 24-26 in downtown Nashville, Tennessee. The Summit will bring bank and credit union executives together with banking’s top consultants for a variety of presentations, panel discussions and networking opportunities. Here are a…...

Implementing migration analysis for the ALLL?

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Posted by Sageworks

By Aaron Lenhart, Risk Management Consultant at Sageworks It’s recognized that migration analysis is a more comprehensive loss rate calculation for banks and credit unions, as it more accurately reflects loan performance and loss over time. But it’s not a process that can be started overnight. Successful implementation of migration…...

5 steps to uncover mid-year accounting client opportunities

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Posted by Sageworks

Summer is a great time for accounting firms to look for fresh opportunities to grow the business. Here are five ways accounting firms can “fertilize” existing efforts in order to jump-start business and grow deeper, stronger roots with clients. 1. TRAIN YOUR TEAM - Do firm members truly understand the…...

Why banks should use migration analysis

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Posted by Sageworks

While the implementation of migration analysis can be a tough hurdle for many institutions, those that deploy the technique can obtain a more comprehensive and accurate measure of their reserve. By evaluating their pooled loan segments at the risk rating level, for example, and tracking the migration of those loans…...

Why accountants choose ProfitCents

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Posted by Sageworks

Accounting professionals go the distance for their clients and arm themselves with the information and tools they need to be successful at their jobs. That’s why accountants looking to win new clients and increase engagements use ProfitCents. ProfitCents was developed by Sageworks, the leader in the financial analysis of privately…...

Stress testing deferred in OCC proposed rule

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Posted by Sageworks

The OCC released a proposed rule impacting financial institutions greater than $10B in assets, which are required to submit stress testing results on an annual basis. If implemented, the proposed rule would delay the timelines upon which results must be submitted to federal agencies, giving the financial institutions more time…...

The truth about valuations in 2014

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Posted by Sageworks

Low interest rates. Ample bank financing. Record capital committed to private equity funds. The highest value of private-equity backed buyout deals since 2007. These factors and others are contributing to intensifying deal competition, which means private equity firms on both sides of transactions must increasingly find an edge to win without…...

Rocky Bleier announced as Summit Guest Speaker

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Posted by Sageworks

Sageworks is pleased to announce war veteran and Super Bowl Champion Rocky Bleier will be a guest speaker for the 3rd Annual Risk Management Summit. The premier conference for banking executives, covering the ALLL, stress testing and risk management best practices, will be held September 24-26 in Nashville, Tennessee. Bleier…...

Free CPE webinar: “Building a firm of the future”

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Posted by Sageworks

By the end of this decade, most accounting firms will face a change of seismic proportion – the transfer of leadership to the next generation. Firms that develop and execute strategies around their people, market insights and agility are the most likely to survive, while those that don’t will probably…...

Top priorities for you to focus on in your accounting firm

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  By Lauren Prosser, Director of ProfitCents Professional Services If your CPA firm is like most, its biggest assets are the staff and clients. Knowing more about these assets and gaining greater and more timely insights into the roles they play in the firm's success will enable you to better…...

Tech decisions for your bank’s Board

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BankDirector recently released a new whitepaper, The Role of the Board in Technology, explaining how technology-investment decisions should include Board of Directors participation. More than just their impact on the bank’s budget, technology decisions often relate to strategy within the institution, including areas of growth, weaknesses identified through the exam…...

Backtesting the ALLL: deeper investigation of specific portfolio segments

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On the specific portfolio segments, first, it is important to determine answers to several questions from period to period. Which segments had an increase in the FAS 5 reserve? How much of the increase is due to changes in volume of that portfolio? How much is due to change in…...

Most common challenges facing business valuation professionals

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Posted by Sageworks

The process of valuing a business combines both art and science and can be arduous. Generally speaking, a detailed, comprehensive analysis and the ability to develop accurate projections and assumptions are necessities. Business valuation also requires the application of finance theory in the appropriate places and using professional judgment. With…...

Why technology is needed for stress testing

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Posted by Sageworks

Shifting regulatory demands often have direct impact on banks and their use of technology and innovative processes. The next shift is around stress testing, according to a recent article by American Banker’s Penny Crosman.  A general theme coming from bankers and consultants that attended the American Banker Stress Testing 2014…...

Why is the quick ratio important?

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There are numerous qualitative measures that can indicate expected financial performance when evaluating credit risk in new and existing business relationships. However, it’s important to consider the key metrics that accompany the 5 Cs of Credit. In addition to the debt service coverage ratio and net profit margin, it is…...

Understanding a business valuation

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It has come to our attention that many accountants are interested in expanding their firm by adding a business valuation practice, however there isn’t much existing easy-to-understand literature on what exactly a business valuation is as well as its components. A business valuation is a set of processes and procedures…...

ALLL backtesting at the portfolio level

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On the simplest level, backtesting of the ALLL can be completed on global level, comparing the institution’s ALLL to its realized losses over a period of time. An example is shown below: Figure 1   In this example, the institution is looking at its ALLL and comparing that amount with…...

2 Approaches for marketing advisory services in your accounting firm

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Choosing the right clients is incredibly important when marketing business advisory services. Once you have completed the selection process it’s important to alert your clients to your new services in a way that’s informative without being pushy. When offering advice to prospective clients, we suggest you take one of these…...

Backtesting the ALLL – what is backtesting?

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Given the increased regulatory scrutiny over the allowance for loan and lease losses (ALLL) in the past several years, regulators, auditors and senior management are all looking for additional ways to measure the effectiveness of the bank or credit union’s ALLL methodology. The OCC’s 2011 Supervisory Guidance on Model Risk…...

How to pick the ‘right’ client and stand out among other accounting firms

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Remember dating in high school? You know that guy or girl who you liked but were pretty sure didn't feel the same way back? It is likely that you spent countless hours trying to wow him or her, but to no avail. In the end, although you were unlikely to…...

Who will be affected by the NCUA’s RBC proposal?

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Although the risk-based capital (RBC) proposal being pushed by the National Credit Union Administration (NCUA) is only currently directed towards credit unions above $50 million in assets, CUs regardless of size should read the proposal carefully and determine how it will indefinitely impact them. Recent consolidation trends are projected to…...

Sageworks announces topics for 3rd annual Risk Management Summit

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Posted by Sageworks

Sageworks just released the topics for the upcoming 3rd annual Risk Management Summit, which will be held September 24-26 in Nashville, Tennessee. Maintaining a focus on the ALLL and stress testing, the Summit will bring bank and credit union executives together with banking’s top consultants for a variety of presentations,…...

Best practices for determining the right measure of loss

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Loss measures, or the methods by which an institution calculates loss rates used in determining the allowance for loan and lease losses (ALLL), are oftentimes passed down period to period at institutions with little consideration. “It has always been done this way” is the refrain consultants frequently hear. Prudent institutions…...

Why is net profit margin important?

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There are numerous qualitative measures that can indicate expected financial performance when evaluating credit risk in new and existing business relationships. However, it’s important to consider the key metrics that accompany the 5 Cs of Credit. In addition to the Debt Service Coverage Ratio, it is important to measure and…...

How to build a valuation practice within your accounting firm

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Many public accounting firms are developing business valuation practices as a way to meet the needs of existing clients while distinguishing the firm with specialized services. A best-in-class business valuation practice will ensure compliance with accounting standards and incorporate quality controls that ensure a superior analysis, superior report product and…...

Determining the right level of loss using the historical loss method

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The historical loss method uses an annualized average net charge-off rate incurred during a prescribed time period as a proxy for estimating future losses. The loss rate is derived either from losses incurred from the institution’s own portfolio or those incurred by a peer bank or a pool of peer…...

What is the debt service coverage ratio?

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Recent regulatory changes and comments from regulators suggest increased oversight for financial institutions and decreased tolerance of credit risks tied to new and existing business relationships. There are numerous qualitative measures, like past experience with the borrower, which can indicate expected financial performance. However, it’s important to consider and measure…...

Becoming a trusted advisor to your clients

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Accountants perform the role of providing financial data very well. However, simply presenting clients with this data is not enough to become indispensable. It is now necessary to translate and interpret the data for your client. ProfitCents by Sageworks does this by compiling the data into an easy-to-understand narrative report…...

Loss discovery method of analysis for determining the correct method of loss

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The Loss Discovery Method is a slight variation of the historical loss and migration analysis methods. The key difference is that it uses an additional factor: time. Loss Discovery measures the time between:1.    when an institution recognizes that a customer cannot meet his or her obligations, and2.    when a charge-off…...

Probability of default and loss given default analysis

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Probability of Default/Loss Given Default analysis is a method used by generally larger institutions to calculate expected loss. A probability of default (PD) is already assigned to a specific risk measure, per guidance, and represents the percentage expectation to default, measured most frequently by assessing past dues. Loss given default…...

Determining the right measure of loss

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Posted by Sageworks

Chief financial officers at financial institutions have enough to worry about without the historical loss measure for FAS 5 loans. Unfortunately, key parties—from the Board of Directors to auditors to regulators—worry about it each time an ALLL calculation is performed. What measure is right? Does the loss period cover too…...

How can software help with your bank’s loan administration?

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Posted by Sageworks

For many institutions, loan administration systems exist as a series of disconnected spreadsheets. Over time, these spreadsheets can grow into lengthy, multi-tab documents for each loan with the details of which financial ticklers and policy covenants are required at what times. The actual documents being tracked are often stored in…...

7 Ways to rev up your accounting firm after busy season

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By Nancy Fox, founder & President of The Business Fox Another busy season is just about under your belt. Whew. If you’re like many (even most) accountants, you’ve been lulled into “busy- season-itis” – that debilitating syndrome of keeping your head down (working on taxes and client matters only) between…...

Why are institutions not backtesting their allowance calculations?

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Posted by Sageworks

Banks and credit unions backtest their allowance for loan and lease losses (ALLL) in order to compare actual results for a defined period to the results forecasted by a model for the same period. This allows institutions to monitor model performance and adjust or revise it over time. It also…...

Success with automating loan administration – beyond time savings, eliminating institutional risk

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The value of automating your loan administration process extends beyond process efficiencies, and can even have lasting impacts by improving institutional risk management. With automated exception tracking and notifications when loans reach exception status, an organization can implement a new institutional standard for completeness and timeliness of records associated with…...

New ProfitCents help center has how-to’s, tips and assistance

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At Sageworks, we know that without our customers, our company is nothing. That’s why the major enhancements we recently introduced to our flagship ProfitCents platform are aimed at making the user experience more streamlined and more customizable so that ProfitCents customers can better meet their clients’ needs and win new…...

The pros and cons of using spreadsheets – abiding by regulatory parameters

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Posted by Sageworks

Banks and credit unions have utilized spreadsheets as a primary tool in risk management for decades. Unfortunately, over-reliance on these spreadsheets has become an area of serious regulatory concern, as many of the benefits offered by spreadsheets are often shadowed by potentially significant risks. Compliance with regulatory parameters is one…...

Top 10 challenges facing community bankers

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Posted by Sageworks

Today’s regulatory environment continues to be the most pressing issue to community bankers, according to a recent poll conducted by the CB Journal. The ten most important challenges to community bankers, according to the CB Journal’s poll, are: 1. Regulatory Climate 2. Interest Rate Environment 3. Loan Growth 4. The…...

Video: How to justify and support your qualitative factors – Part I

Sageworks
Posted by Sageworks

Justifying and documenting qualitative and environmental factors in the allowance calculation is a common challenge for banks and credit unions. More than 50 percent of the bankers during a recent webinar pointed to qualitative and environmental factors as their biggest ALLL challenge. In part 1 of this video series on…...

What is your current networking ROI?

Sageworks
Posted by Sageworks

In this brief video, founder and president of The Business Fox, Nancy Fox, discusses how to calculate your networking return on investment (ROI). Fox highlights that you should be taking into account membership dues/fees, conferences, lunches, and travel expenses. She points out that on average, professionals spend $2,500 per year…...

Why should you automate loan administration?

Sageworks
Posted by Sageworks

Many financial institutions have gotten by using their core system or a series of spreadsheets to manage tickler and covenant tracking as well as client communications. In today’s regulatory environment, however, banks and credit unions are being asked to minimize risk and standardize processes. An easy step with loan administration…...

Backtesting: Deeper investigation of specific portfolio segments

Sageworks
Posted by Sageworks

Backtesting the allowance for loan and lease losses (ALLL) enables banks and credit unions to compare actual results for a defined period to the results forecasted by a model for the same period in order to evaluate accuracy of the model’s predictiveness. When evaluating specific portfolio segments, it is important…...

How often should an institution obtain new appraisals when using the collateral method?

Sageworks
Posted by Sageworks

In a recent webinar, Garrett Morris, senior credit and risk management consultant at Sageworks, discussed how often an institution should obtain new appraisals when using the collateral method of loan analysis.  From the video: An institution should obtain new appraisals early - as often as they can. Even more sensibly,…...

Valuation best practices for private equity firms

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Posted by Sageworks

Whether being used for performance data or to win deals, valuations that private equity firms develop should be supported by a methodology that is: • Robust • Consistent, and • Transparent Robust. Valuations are most accurate (and defensible) when they are developed through a robust process. As the International Private…...

Breakeven analysis – when can you start making money

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Posted by Sageworks

For a Chief Financial Officer of a company, profitability is sure to be front-of-mind. Even if you have a great product and are generating consistent sales, many business owners and key decision makers can find themselves surprised that their business is still not making them any money.  According to the US…...

Due diligence in third party risk management

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Posted by Sageworks

An effective risk management process includes a continuous lifecycle for all third-party relationships and covers planning, contract negotiation, ongoing monitoring, termination, and due diligence and third-party selection. An in-depth assessment of a third party’s ability to perform critical activities while complying with regulatory guidelines should be performed before entering into…...

Party time at the branch

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Posted by Sageworks

By Banking.com Everyone in our industry acknowledges banks need to be different, and we’ve explored numerous initiatives on Banking.com, from video transactions to teller pods and community rooms.  But how about serving up a cocktail with your account statement? That’s one way to look at St. Petersburg, Fla.-based C1 Bank’s…...

How to develop an industry niche

Sageworks
Posted by Sageworks

In this brief video, founder and president of The Business Fox, Nancy Fox, discusses how to develop a “rich” niche market. Fox highlights that there are three pathways to developing a niche market: industries, common factors, and motivations. In addition, Fox suggests thinking outside of the box when developing your…...

Sageworks to host 3rd annual Risk Management Summit this September

Sageworks
Posted by Sageworks

The 3rd annual Risk Management Summit is returning to Nashville, TN, for a third straight year, but with a new date and venue. Bankers and industry experts will gather Wednesday, September 24th, through Friday, September 26th, at the newly-renovated Hilton Nashville Downtown. This location, directly across from the Country Music…...

What accountants say during busy season

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Posted by Sageworks

We all know that busy season is the time of year when accountants are spending countless hours in the office. So, we figured there had to be lots of phrases accountants use and questions they are asked prior to April 15th and wanted to share what we found. When we…...

Does your familiarity with spreadsheets make you complacent?

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Posted by Sageworks

Did you know that over 80 percent of bankers polled reported using spreadsheets for the credit analysis of their loan portfolios? More often than not these individuals are utilizing spreadsheets simply because it’s what they’re most familiar with. In fact, no longer is using spreadsheets an advantage in the professional workplace;…...

Common challenges with impairment analysis

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Posted by Sageworks

In a recent webinar, Garrett Morris, senior credit and risk management consultant at Sageworks, discussed common challenges with loan impairment.  From the video: Let's look at the general challenges faced when determining impairment. Examining those common challenges with impairment, we find there are quite a few.  First, using present value…...

Grow your own business bankers

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Posted by Sageworks

By Jeff Marsico, The Kafafian Group Commercial loan growth is difficult to come by these days. Some is a result of anemic economic growth and an uncertain business climate. These factors are beyond a banker's control. But what is within your control is the number and quality of business bankers…...

1 Easy way to go from tax accountant to trusted advisor

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  If you could plant a seed this busy season that would help you grow your business the rest of the year, would you do it? Many accountants have found that they can quickly show clients they are more than tax preparers by providing something nearly all business owners want…...

Infographic: Challenges facing private equity firms

Sageworks
Posted by Sageworks

Private equity firms are increasingly facing challenges when it comes to portfolio valuations. These challenges include protecting the firm's reputation, information asymmetry, and transparency of information. This infographic identifies these challenges, provides solutions to create thorough valuations and the benefits of technological solutions.  Click here to download the full infographic. ...

2014 Community banking best practices: Define your institution’s credit culture

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Posted by Sageworks

Last week’s post that continued the 2014 community bank best practices series discussed the importance of mapping out your most common processes to increase consistency in the loan review process. This final post of the 2014 Community banking best practice series will explore the reasons why you should define your…...

5 funny accounting types to follow on Twitter

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Posted by Sageworks

Let’s face it, during busy season, many accountants don’t have time to watch “Late Night with Jimmy Fallon” or to catch re-runs of “The Office.” But you can still get a few laughs throughout the day by following some of these amusing accounting types on Twitter. Some have given special…...

Why you should consider using a qualitative scoring matrix

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Posted by Sageworks

Banks and credit unions often cite the qualitative and environmental factors as one of their biggest challenges within the allowance for loan and lease losses (ALLL). During a recent webinar, Sageworks consultants discussed how to document qualitative factors. In addition to ensuring directional consistency, another consideration for justifying adjustments is…...

Biggest networking mistakes for accountants

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Posted by Sageworks

In this brief video, founder and president of The Business Fox, Nancy Fox, discusses mistakes accountants make when networking. Fox highlights that the number one networking mistake for accountants is networking in the wrong groups and attending the wrong venues. In addition, Fox states that accountants most often network laterally,…...

What questions should bank boards be answering?

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Posted by Sageworks

Bank and credit union board members make every decision with a delicate balance of trying to maximize the institution’s performance without putting themselves at risk, according to a recent article by Jack Milligan. In the article, Milligan highlights four uncomfortable questions every bank board should answer: • Does the CEO…...

Infographic: Cross-sell accounting services during busy season

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Posted by Sageworks

Cross-selling accounting services to your existing client base is a more economically efficient way to increase revenue, as opposed to acquiring new customers. The AICPA estimates that it costs 11 times more to acquire a new customer than to keep an existing one. The infographic identifies four steps to win…...

2014 Community banking best practices: Map your most common processes

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Posted by Sageworks

Last week’s post that continued the 2014 community bank best practices series discussed the importance of defining your bank's risk appetite to diversify risks in the upcoming year. This post will explore the reasons why you should map out your most common processes. In this clip from a recent Sageworks…...

4 Reasons to talk about succession planning with clients during busy season

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Posted by Sageworks

Accountants in the thick of busy season have so many demands on their time that it can seem impossible or undesirable to bring up anything new with clients when you meet or call. But this is a great time to explore whether clients have planned for the future of their…...

Ensuring directional consistency in qualitative factors

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Posted by Sageworks

The qualitative and environmental factors within the allowance for loan and lease losses (ALLL) are often a major challenge for banks and credit unions due to their inherently subjective nature. Additionally, very little guidance is provided in the 2006 Interagency Policy Statement on the ALLL. During a recent webinar, Sageworks…...

How to calculate present value of future cash flows for a TDR

Sageworks
Posted by Sageworks

In a recent webinar, Garrett Morris, senior credit and risk management consultant at Sageworks, discussed how to use present value of future cash flows for a TDR when calculating loan impairment. From the video: Present value of future cash flows should be used when there is an expectation of cash payment…...

2014 Community banking best practices: Defining your bank’s risk appetite

Sageworks
Posted by Sageworks

In last week’s post that continued the 2014 community bank best practices series, we discussed the importance of investing in project management training to better incorporate your employees in your strategic initiatives. This post will explore the reasons why you should, if you haven’t already, define your bank’s risk appetite.…...

3 Tips for busy season marketing and business development

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Posted by Sageworks

Guest Post By Elizabeth Fiore, CPAmerica International With busy season in full swing, it is easy to let the marketing and business development activities slip (you know, the ones which made you busy in the first place). It’s crucial for your pipelines that you continue your marketing and business development activities…...

5 places to take free business courses online

Sageworks
Posted by Sageworks

By Bailey McCann, Funding Gates Bailey McCann Education is key if you want to stay on top of business procedures and trends, as well as learn about the latest software, applications, and technologies in your industry.  All those classes, workshops, and training tools, however, often come with a price tag that…...

More data required for Expected Loss Model

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Posted by Sageworks

It has been well documented that the FASB’s Current Expected Credit Loss (CECL) model, as it is presently proposed, will require banks of all sizes to recognize an immediate allowance for credit losses that represents all future expected losses to be incurred, as opposed to only those losses that are…...

Planning and contract negotiation for third party relationships

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Posted by Sageworks

On December 5, 2013, shortly after the OCC release, the Board of Governors of the Federal Reserve System issued “Guidance on Managing Outsourcing Risk” to supplement guidance previously issued on technology service provider risk. As banks continue to increase the number and complexity of third-party relationships, the OCC is concerned…...

Member and customer service is now defined digitally

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Posted by Sageworks

By Mark Arnold, president, On the Mark Strategies In the “good old days” of financial services (about 10-15 years ago, given the speed of technological advancement) the way banks and credit unions served consumers was defined more or less in terms of personal interaction. The majority of people still visited…...

Increase traffic to your website

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Posted by Sageworks

In this brief video, president of bbr marketing Bonnie Buol Ruszczyk, discusses the top sources of traffic to B2B websites. Ruszczyk highlights that the number one source of traffic is blogging. Many accountants have not yet added a blog to their site, and this is an opportunity to stand out against competitors…...

How to break down financial statements for clients

Sageworks
Posted by Sageworks

In this brief video, Peter Brown, a Sageworks senior consultant, discusses how to put financial statements in simple terms for your clients. He notes that an income statement is a measure of performance over a defined time. Brown also provides definitions for the balance sheet, cash flow, and financial statements…...

2014 Community Banking Best Practices: Developing a Risk-Based Pricing Mechanism

Sageworks
Posted by Sageworks

In a recent webinar on the 2014 Outlook for Community Banks, Ancin Cooley, principal of Synergy Bank Consulting, provided insights into this year’s best practices for community and regional-level banks. This article, the first in a series of five, is meant to share one of the most critical best practice…...

Poll: Do you currently have a specialty niche?

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Posted by Sageworks

Nancy Fox recently hosted a webinar, Targeted Networking for Bigger and Better Lead Generation, which discussed how accountants can generate leads through in-person networking. Fox, Founder and President of The Business Fox, provides strategies for how to generate new leads. During the presentation, finance professionals were polled on if they have a…...

Enhance client relationships — even during busy season

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Posted by Sageworks

Accountants, especially during busy season, have significant demands on their time, so it's critical to understand how to balance a desire to develop deeper client relationships and work-related time constraints. The first step is to recognize that overhauling every client relationship at once is unrealistic and that not all clients are…...

Are banks easing their underwriting standards?

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Posted by Sageworks

Although industry underwriting standards tightened down briefly during the past decade’s economic crisis, recent trends have shown that more banks are easing their standards, according to the Office of the Comptroller of the Currency's 19th Annual Survey of Credit Underwriting. Among other factors, the report identifies an industry-wide increase in liquidity…...

How to develop valuations with Sageworks Valuation Solution precision

Sageworks
Posted by Sageworks

Sageworks, the leader in the financial analysis of privately held companies and maker of ProfitCents, today unveiled a business valuation platform that helps CPA firms, private equity firms and valuation firms determine an accurate and legally defensible value for private companies. Sageworks Valuation Solution, a commercial grade, web-based solution, will…...

What is content marketing?

Sageworks
Posted by Sageworks

In this brief video, president of bbr marketing Bonnie Buol Ruszczyk, discusses content marketing. Ruszczyk highlights that content marketing should communicate how you are different from competitors and should demonstrate how value is in the eye of the reader. According to Ruszczyk, content should be thought of from the reader's…...

How to make your business stand out

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Posted by Sageworks

Most businesses face steep competition. According to the US Small Business Administration, to be successful and break away from the pack, one of the first steps in your business development plan should be to determine your market and identify why they should give their business to you.  Make sure that…...

How to say “no” to an accounting client this busy season

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Posted by Sageworks

Busy season is a time when accountants may find themselves regretting having taken on a particular client, especially when completing the work takes time that could have otherwise been spent on a more pleasant, profitable or valued client. While many accountants would love to have more business to generate more…...

Risk management guidance on third party relationships

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Posted by Sageworks

Examiners have always expected banks and credit unions to perform appropriate vendor due diligence prior to engaging a third party. But with October 2013 guidance, Third-Party Relationships, the OCC provided definitions and guidelines for OCC banks as a risk management framework. As the announcement points out, banks face new and…...

Will revised regulations waive credit unions’ personal guarantee requirements?

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Posted by Sageworks

This year could mark the beginning of eased personal guarantee requirements with the loosening of Member Business Lending (MBL) regulations. According to the National Credit Union Administration’s (NCUA) Office of General Council (OGC), personal lending is just one of the numerous items potentially up for the agency to revisit in 2014. This…...

The truth behind CPA firm client satisfaction

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Posted by Sageworks

  By Jean Marie Caragher, President of Capstone Marketing The improving economy may cause CPAs to be overconfident about their ability to retain clients. In the 2011 PCPS CPA Firm Top Issues Survey, retention of current clients showed up on every segment's top-five list, while it only made two groups'…...

How can an automated ALLL solution help with the FAS 5 process?

Sageworks
Posted by Sageworks

During a recent webinar, How to Calculate Your FAS 5 Reserves, Sageworks consultants discussed how automated ALLL solutions can help banks and credit unions calculate their FAS 5 (ASC 450-20) reserves. From the video Let’s review the bullet points. It saves time in data aggregation. People say, “I spend so…...

5 Things you need to do to make your business better this new year

Sageworks
Posted by Sageworks

By Bailey McCann, Funding Gates Bailey McCann A new year offers many reasons to get excited about your business once again.  The possibility of new clients and customers is one reason to celebrate.  The launch of a new line of product or services very well could be what keeps you working…...

Credit union best practices for MBL systems

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Posted by Sageworks

Business lending has more complex variables and carries more risks to credit unions than other types of lending, according to the National Credit Union Administration (NCUA). That’s why it’s important for credit unions to incorporate critical elements of a sound member business lending program, including having MBL data processing systems…...

What the OCC’s heightened risk expectations mean for community banks

Sageworks
Posted by Sageworks

New risk management requirements could come into effect in the near future, according to the OCC's announcement last week. Their proposal, which focused primarily on banks with more than $50 billion in assets, holds an individual institution’s board of directors responsible for the creation of internal tracking systems, as well as…...

Backtesting in ALLL calculations

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Posted by Sageworks

Backtesting is an exercise that compares the actual outcome with model forecasts during a defined period - a period of time that was not used to develop the methodology. A good starting point for any measure of efficacy is backtesting a reserve methodology on the portfolio. At the simplest level,…...

CPA: How I became a “broker of services”

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Posted by Sageworks

Many accountants desire to reduce reliance on providing often-commoditized services such as tax preparation and financial statements, but how do you get your practice moving in another direction? One option is to take on the role of “broker of services” – someone who advises clients and occasionally puts them in…...

Rethinking accounting marketing

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Posted by Sageworks

In this brief video, president of bbr marketing Bonnie Buol Ruszczyk, discusses how marketing for accounting firms has changed over the years. Ruszczyk highlights that accounting marketing has shifted from an outbound marketing approach, such as telemarketing and print and radio ads, to an inbound approach including search engine optimization…...

An accountant’s checklist for client meetings

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Posted by Sageworks

Building relationships with your accounting clients requires trust, rapport and an atmosphere for open dialogue. Many accounting firms use a checklist to prepare for client meetings and to facilitate information exchange. Here are some questions that many accountants who are clients of Sageworks have found helpful when interacting with their…...

How to implement content marketing in your accounting firm

Sageworks
Posted by Sageworks

By Bonnie Buol Ruszczyk, president and CEO, bbr marketing Everyone’s talking about it and most accounting firm owners have a sense they should be doing it, but what exactly is content marketing? In a nutshell, it’s a marketing paradigm that opts for providing something of value as a method of…...

6 Ways to tackle C&I risks

Sageworks
Posted by Sageworks

Commercial and Industrial (C&I) loans have become a larger part of many institutions’ portfolios due to market demand, examiner feedback and pressures to stay profitable. But there are risks in C&I lending, such as inexperience in the area and inadequate strategic planning. In order to approach it conservatively, here are…...

Report: Current lending challenges similar to those in 2011

Sageworks
Posted by Sageworks

Credit Union Times recently highlighted a new Aite Group report, Top U.S. Lenders Tackle Risk and IT Challenges: Not Their First Rodeo. The report was comprised of two surveys conducted in 2011 and 2013, that covered lenders’ most pressing concerns in the current environment. The 2013 survey was a follow-up to…...

How to ensure your accounting firm’s best busy season ever

Sageworks
Posted by Sageworks

The work schedule is set and everyone at your accounting practice is organized and pumped up to dominate the workload this busy season. Nevertheless, it’s not too late to take some steps that will make this your best busy season ever:  1. Track cross-selling opportunities. Many clients meeting with you…...

Disclosure reporting for ALLL

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Posted by Sageworks

With the release of the July 2010 FASB Accounting Standards Update 2010-20, banks were required to increase transparency pertaining to financial reporting. Robert H. Herz, the FASB chairman, stated: “The global financial crisis highlighted the need for additional information about a company’s financial instruments, including loans and other financing receivables.…...

What is the best way for accountants to approach a prospective client?

Sageworks
Posted by Sageworks

In this brief video, Peter Brown, Sageworks senior consultant, discusses how accountants should approach a prospective client. Brown outlines the importance of developing relationships. This clip is from a Sageworks’ webinar entitled “How will you win your next new client?” In this webinar, Brown points out that social media and emails…...

OCC notes ‘disconnect’ between credit trends, ALLL releases

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Federal regulators are concerned about a “growing disconnect” between underlying credit trends and releases from banks’ allowances for loan and lease losses (ALLL), highlighting the importance of a defensible ALLL calculation.  In its recent semi-annual assessment of risk, the Office of the Comptroller of the Currency highlighted several key risk…...

6 key components that all loan administration systems should have

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Posted by Sageworks

Loan administration is a critical element for the safety and soundness of an institution. While the sophistication of a loan administration system will depend on the size of the institution and the complexity of its portfolio, there are some functions that should be integrated in all: 1. Accessibility of data for…...

3 Key attributes to look for when evaluating your reserve calculation

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In the brief video below, Sageworks explains the three key attributes to look for when evaluating your reserve calculation. From the video: The three key attributes that regulators are going to stress and look for when evaluating an institution's allowance calculation. The first key factor is to make certain that…...

What is the appropriate working capital for your clients’ industry?

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In this brief video, Peter Brown, Sageworks senior consultant, discusses positive versus negative working capital. He notes that manufacturers, wholesalers, and most retailers typically have positive working capital, or a current ratio in excess of 1:1. On the other hand, restaurants, hotel, airlines, and many utilities have negative working capital,…...

How to develop cash flow analysis

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There's nothing quite like cash. It is necessary to start, maintain and grow business operations. However, many small business owners struggle with managing and sustaining their cash reserves. Flawed cash flow analysis or insufficient capital can drastically and negatively affect daily business operations, as well as loan eligibility. Cash flow,…...

FASB rulings cast doubt on financial instruments convergence

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The Financial Accounting and Standards Board (FASB) took measures towards removing itself from merging with the International Accounting Standards Board (IASB) last week with several provisional rulings on its project on accounting for financial instruments. With regards to classification and measurement, the board determined that it would not move forward…...

Is your accounting firm actively engaged on Linkedin?

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Bonnie Buol Ruszczyk, president of bbr marketing, recently hosted a webinar for Sageworks, How to Generate Leads through the Web. In this webinar, Bonnie provided key strategies for improving your firm's presence on social media, as well as other content marketing strategies. During the presentation, finance professionals were polled on if…...

What is the difference between FAS 5 and FAS 114 loans?

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In a webinar on How to Calculate Your FAS 5 Reserves, Sageworks consultants discussed the difference between FAS 5 (ASC 450-20) and FAS 114 (ASC-310-35) loans. From the video: What is the difference between FAS 5 and FAS 114 loans? In order to understand FAS 5, it is important to understand…...

What is the difference between ASC 450-20 (FAS 5) and ASC 310-10-35 (FAS 114) loans?

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In a webinar titled How to Calculate Your FAS 5 Reserves, Sageworks discussed the difference between ASC 450-20 (FAS 5) and ASC 310-10-35 (FAS 114) loans. From the video: What is the difference between ASC 450-20 and ASC 310-10-35 loans? In order to understand ASC 450-20, it is important to…...

Who is in charge of value at your accounting firm?

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By Ron Baker, Author of "Implementing Value Pricing: A Radical Business Model for Professional Firms" I have had the privilege of posing this question—Who’s in charge of value in your accounting firm?—to thousands of professionals around the world. I’m usually met with a momentary staring ovation, and then someone will…...

How the SBA can help grow your small business

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Growing and financing a business is an incredibly difficult undertaking; the Small Business Administration (SBA) has a wealth of resources available to help small businesses meet their financial needs, including debt financing, surety bonds and equity financing. Debt Financing The SBA cannot directly lend capital to small businesses. However, that…...

5 Ways for small businesses to give employees “affordable” holiday bonuses

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By Bailey McCann, Funding Gates When it comes to the holidays, there are a lot of ways you can reward your employees for their hard work. As much as you’d like to spend big money on gifts for everyone, that isn’t always feasible. So, what do you do to make the…...

Fed calculations contradict that of many large banks

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The Federal Reserve is likely to calculate lower capital ratios for large lending institutions than lending firms' own internal calculations, according to a recent letter from the Federal Reserve. This is due to the fact that Fed estimates are predicated on historical data, showing that industry assets grew in the…...

Is your accounting firm on pace to succeed in the future? Part 2

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In Part 1, we discussed how firms that are considered pioneers in technology, by the CCH report, have the highest revenue growth and ranked significantly higher on many work environment scales. Today, we’ll talk about why they scored better based on staffing strategies and technology strengths. Here’s a brief recap…...

10 Objectives loan review systems should address

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It is essential that all regulated financial institutions have an effective loan review system, even if they aren’t expected to maintain a separate loan review department, according to a recent article by CEIS Review. The loan review system provides critical and objective information to executives about credit quality, portfolio trends…...

Final rules implementing Volcker Rule

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On Tuesday, December 10 five federal agencies announced final rules to enforce section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, commonly known as the Volcker Rule. The rules generally prohibit banking institutions from engaging in short-term proprietary trading of securities, derivatives, commodity futures and options on…...

Valuations: 4 things that make private companies different

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While Wall Street firms get a lot of publicity (especially when it comes to mergers and acquisitions), most of the 27 million U.S. businesses are privately held. For accountants and others in financial services, that means a multitude of opportunities can arise to use valuations in planning for succession, evaluating…...

What is the average number of services per client for top CPA firms?

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In this brief video, Lauren Prosser of ProfitCents points out that 25-40 percent of new business that CPA firms generate, come from additional work with existing clients. Prosser provides insight on the cost-effectiveness of introducing new services to an existing client, as opposed to winning a new client.  This clip…...

Update on FASB and IASB models: Convergence?

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Given that bankers and even Comptroller of the Currency Thomas Curry have gauged the CECL model, as it stands in current proposals, could increase bank reserve levels by 30-50 percent, the FASB’s proposed current expected credit losses (CECL) model has garnered much attention. The latest on CECL, information coming from…...

Interpreting FAS 5

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In a webinar on How to Calculate Your FAS 5 Reserves, Sageworks consultants discussed the ambiguous nature of the FAS 5 (ASC 450-20).  From the video: The topic of the day is our FAS 5s, also known at ASC 450-20. We are talking about one of two major components or guidances…...

The discovery process for accountants

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In this brief video, Lauren Prosser of ProfitCents describes the objectives of "The Discovery Process" for CPAs and accountants. Prosser provides insight on how to identify opportunities to sell more accounting services to existing clients. She also discusses shifting your focus from the problem to the solution, developing client-centric definitions,…...

Why community banks should stick around

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Slate’s Matthew Yglesias recently published a blog post that argued against the need for community banks. He claimed that microbanks have three, basic problems: “they are poorly managed”, “they can’t be regulated” and “they can’t compete.” The policy he hopes for is to “simultaneously contain the size and leverage of…...

What is the biggest source of traffic for accounting firms?

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Bonnie Buol Ruszczyk, president of bbr marketing, recently hosted a webinar for Sageworks, How to Generate Leads through the Web. In this webinar, Bonnie provided key strategies for improving your firm's presence on social media, as well as other content marketing strategies. During the presentation, finance professionals were polled on what…...

Moving from the OTS to the OCC: A brief history

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Once vitally important for consumer and mortgage lending needs, the Office of Thrift Supervision (OTS) experienced a steady decline in size and importance during the past fifty years. In the 1960s, the OTS (which pre-1989 was known as the Federal Home Loan Bank Board) regulated institutions that were responsible for…...

Number of FDIC-backed banks fall to record lows

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Recent FDIC data indicates that the number of federally insured banks and financial institutions has dipped below 7,000 for the first time since the Great Depression. At the end of September, only 6,891 banks have such standing, with analysts predicting that number to fall below 5,000 before 2025.  While consolidations…...

12 Signs of loan administration danger

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To keep good loans from going bad, proper monitoring of the portfolio is necessary. The following signs of danger can help banks and credit unions informally assess the adequacy of their loan administration system. Positive responses to the items below suggest additional risk. 1. Federal examiners or auditors have identified…...

7 Sources of content marketing ideas for accountants

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Content marketing is one way an accounting firm can shift its marketing strategy from an outbound, push-oriented approach to an inbound approach that pulls clients and potential clients in for the firm and helps generate leads. Bonnie Buol Ruszczyk, named for the second year in a row by Accounting Today…...

Key characteristics of FAS 5

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In a recent webinar on How to Calculate Your FAS 5 Reserves, Sageworks consultants discussed key quantitative and qualitative characteristics of FAS 5 (ASC 450-20).  From the video Tell us more about the key characteristics of the FAS 5 - or the quantitative and qualitative factors?  Again, we have already identified those…...

Bankers’ top exam advice on the ALLL

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Banks and credit unions spend months preparing for safety and soundness examinations, and one area that has received regulatory scrutiny in these regulatory reviews is the allowance for loan and lease losses. Even if the bank or credit union hasn’t recently made a significant change in the ALLL, this area…...

OCC releases guidance on deposit advance products

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Last week the Office of the Comptroller of the Currency (OCC) published final guidance for national banks and savings associations. The regulation addresses risks and expectations associated with deposit advance products. “The OCC encourages banks to offer responsible products that meet the small-dollar credit needs of customers,” Comptroller of the Currency…...

What are 2 common loan documentation dangers?

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Posted by Sageworks

A bank or credit union’s loan portfolio can be the biggest source of risk for their safety and soundness. To keep good loans from going bad, proper monitoring of the portfolio is necessary. Having ineffective loan administration can pose many common documentation dangers for banks and credit unions, such as…...

What is the #1 reason why businesses fail?

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Posted by Sageworks

ProfitCents by Sageworks recently hosted a webinar, How to Help Business Clients Win Loans, which discussed key strategies on how to assist clients with winning loans more effectively. Peter Brown, senior consultant at Sageworks, mentioned that by helping your clients work through their needs for capital, you will deepen the…...

Loan documentation dangers: Incomplete financials

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The loan portfolio can be the biggest source of risk for a bank or credit union’s safety and soundness, but that risk does not end with underwriting and origination. Proper monitoring of the portfolio is necessary to keep good loans from going bad. And while it’s rare that a bank…...

FDIC and OCC propose new liquidity regulations

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The FDIC and the Office of the Comptroller of the Currency (OCC) recently proposed additional regulations aimed at improving the liquidity risk management of large financial institutions. The proposed regulations are materially the same as those passed by the Fed late last month and applies to • Banks with $250…...

Are your clients aware of the services you offer?

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In this brief video, Director of ProfitCents Professional Services Lauren Prosser points out that two-thirds of clients are not aware of all of the services that accounting firms offer. Prosser provides insight on how to identify opportunities to sell more accounting services to existing clients.  This clip is from a…...

Is your accounting firm on pace to succeed in the future? Part 1

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Posted by Sageworks

A new report released by CCH suggests that pioneers and early adopters to new technology are best suited to succeed in the current accounting landscape. As a brief preface, let’s talk about the four main categories of adopters. First there are the pioneers; they are risk takers and first movers.…...

Poll: Biggest areas of change when transitioning from OTS to OCC

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With the 2011 closing of the Office of Thrift Supervision (OTS), the institutions it once regulated have mostly transitioned to a new charter whereby many are regulated now by the Office of the Comptroller of the Currency (OCC). Since the transition, both regulators and the institutions have faced challenges that…...

The importance of qualitative and environmental risk factors in the ALLL calculation

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In a recent webinar on How to Justify a Change in Your ALLL consultants at Sageworks discuss the importance of qualitative and environmental risk factors in the ALLL calculation. From the video Everybody’s favorite topic - yours and mine as well - let’s talk a little bit about qualitative and…...

Why do business owners choose a competitor?

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In this brief video, Sageworks’ senior consultant Peter Brown discusses why clients select a certain accounting firm. Brown highlights that 23 percent of business owners choose a competitor due to lack of industry knowledge. He also points out that there is a misconception among accountants that clients choose a competitor…...

Member business lending: Opportunity for credit unions

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In March of 2011, only 30 percent of credit unions provided credit to businesses, according to the National Credit Union Administration (NCUA). However, member business lending has increased consistently as of late and the trend is expected to continue. This is in large part due to member business loans (MBLs)…...

A shift in the top 5 issues for CPA firms

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Posted by Sageworks

  Guest Post By Elizabeth Fiore, CPAmerica International As the economy has improved, it’s no surprise the top issues facing CPA firms have also shifted from 2011 to 2013, according to The PCPS CPA Firm 2013 Top Issues Diagnostic Report published by the AICPA. “Putting the economic uncertainty of the…...

Fed details newer and more stringent stress testing requirements

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On November 1, the Federal Reserve Board released the 2014 Comprehensive Capital Analysis and Review (CCAR) Summary Instructions and Guidance, detailing stress testing practices for large bank holding companies in the coming year. For the last four years, 18 bank holding companies have been required to comply with the Comprehensive…...

Advice from Summit speakers: 3 Ways to mitigate risk

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Bankers in today’s environment face a number of challenges, including understanding and complying with ongoing regulatory changes, developing and conducting adequate stress testing methods, and justifying or defending changes in their allowance reserves. But there are many things bankers can do to mitigate risk in those areas, according to several…...

Historical loss rates for ALLL calculation

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Posted by Sageworks

Historical loss rates significantly impact the reserve amount, as they determine the reserve needed for impairment in FAS 5 loan pools. Often these pools of loans make up a substantial portion of the bank's or credit union’s portfolio and reserve calculation, so gathering and accessing data for historical loss rates…...

Advantages of web-based software in banking

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Posted by Sageworks

The transition to web-based software solutions is among the most noticeable trends in the financial services industry. Web-based programs mean that users can access programs through their web browser and do not require a download or install. This common practice has a lot of institutions asking the same question: What…...

Poll: Does your firm track cross-selling opportunities identified vs. closed?

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ProfitCents by Sageworks recently hosted a webinar, Cross-sell accounting services: How to identify opportunities to sell more accounting services to existing clients, which discussed how to lay a foundation for your accounting firm's sustainable growth by cross-selling services to your existing client base. Lauren Prosser, Director of ProfitCents Professional Services, outlines…...

How do clients want to be approached about additional service offerings?

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In this brief video, Sageworks senior consultant Peter Brown discusses how clients would like to be approached about your firm’s additional services. Brown highlights that 50% of clients would prefer a phone call or visit over an email or message via social media. He suggests to use times of the…...

Incorporating Basel III reforms for stress testing

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Posted by Sageworks

Late last month the Federal Reserve Board published two interim rules that explain specifically how banking institutions should apply Basel III reforms into their projections for the next round of capital plan submissions and stress tests.  The information is important because the upcoming stress testing and capital planning cycle, which…...

3 Key risk areas in member business lending

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As part of Sageworks’ ongoing video series addressing some of the challenges and questions regarding credit analysis, Garrett Morris, senior risk management consultant at Sageworks, explains the three key risk areas in member business lending. From the video There are three key risk areas in member business lending: Can my…...

Poll: Does your firm have a formal client service plan?

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Posted by Sageworks

ProfitCents by Sageworks recently hosted a webinar, Cross-sell accounting services: How to identify opportunities to sell more accounting services to existing clients, which discussed how to lay a foundation for your accounting firm's sustainable growth by cross-selling services to your existing client base. Lauren Prosser, Director of ProfitCents Professional Services, outlines…...

How my accounting firm raised prices

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Posted by Sageworks

Is it time for your accounting firm to raise prices? Most top U.S. accounting firms are generating revenue growth by offering services that go beyond traditional work such as tax preparation and bookkeeping: valuations, strategic planning and other business advisory services. But it’s hard enough for some accountants dealing with…...

How CPAs can find niche markets with industry data

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Posted by Sageworks

There’s been a lot of media coverage the past few years about identifying niche markets and how CPAs should invest resources into targeting/creating them. Given demands already placed on you and your practice, it is important to know why niche markets are worth finding.  For one, the niche industries you’ll…...

4 Ways industry data can improve your commercial credit analysis

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Commercial lending can be a large source of credit risk for any bank or credit union, especially for institutions in which commercial analysts are unfamiliar with the companies being analyzed or their industries. In that scenario, it’s like trying to read a book but not knowing the language. Or, at…...

Infographic: Top 5 ways accountants can use industry data

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While industry data can be a valuable resource for accountants, it’s not always easy to identify the best ways to use it. In this infographic, learn the top 5 ways accountants can use industry data to create value for their clients and their firm.      Sageworks provides private company…...

Winning new clients: Why do firms win business in the final bidding stage?

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In this brief video, Sageworks senior consultant Peter Brown discusses how to win new clients for your firm. Brown provides insight on how to keep your firm on top by looking into the future and identifying key factors that will help you win new clients. This clip is from a…...

Collateral valuations for reserve calculation

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Posted by Sageworks

Measuring impairment based on the Fair Market Value of Collateral is the most commonly used valuation method for calculating impairment for FAS 114 loans. These loans are and should be considered collateral-dependent, meaning that it is expected that repayment of the loans will be derived from the sale or operation…...

CEIS: Controls necessary to manage increase in hybrid asset based lending

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Posted by Sageworks

Many banks are initiating or expanding their interest in hybrid asset based lending operations, according to a recent article by CEIS Review. But their success and effectiveness in the area varies. CEIS notes that the portfolio and income fee diversification are important, but “the increased activity should be fully vetted…...

2 Questions accountants should ask about their analytical procedures

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One of the top issues that accounting firms have faced with implementing SSARS 19, the standards for compilation and review, is that analytical procedures are poorly designed or documented, according to a recent CPE course booklet by Perry M. Henderson, CPA.  Download a Guide to Audit & Review Best Practices and…...

How small businesses can avoid a tax audit

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Posted by Sageworks

By Bailey McCann, Funding Gates Bailey McCann First the bad news – small businesses are often the go-to target for the IRS if they are looking at who to audit.  Small businesses take a number of deductions that can be hard to justify without rock solid paperwork and receipts (like…...

Why should institutions have a comprehensive ALLL?

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Posted by Sageworks

In a recent webinar on How to Justify a Change in Your ALLL, Sageworks consulting staff explained why institutions should have a comprehensive ALLL and the benefits of comprehensive calculation.  From the video:  In comprehensive calculation essentially you want to be performing the most comprehensive, robust, detailed calculation that you can…...

5 Resources for accountants helping clients with health-care questions

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Are you getting calls from self-employed clients and small business owners who are trying to investigate the options for health care plans on healthcare.gov? It wouldn’t be surprising, considering CPAs have historically been among the top resources for human resource compliance issues. You and your clients may have run into…...

Identifying the best reports for stress testing

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Posted by Sageworks

According to experts, tackling the richest data points first can also help banks generate meaningful reports analyzing risks sooner. As you add data, the detail of your analyses can always be stepped up. Sean Delehanty, senior credit officer of Omnibank, N.A., said that once OmniBank had gathered substantial data, it…...

Business lending vs. consumer lending: How is the evaluation process different?

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Posted by Sageworks

As part of Sageworks’ ongoing video series addressing some of the challenges and questions regarding credit analysis, Garrett Morris, senior risk management consultant at Sageworks, explains the similarities and differences between business and consumer lending analysis. From the video Member business lending or commercial lending analysis is different from consumer…...

Obtaining loan portfolio information for ALLL calculations

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Posted by Sageworks

Obtaining loan portfolio information and keeping this data updated can be both time consuming and difficult, but the information is very important to a bank’s Allowance for Loan and Lease Losses (ALLL) calculation. The amount of data available in an institution’s loan processing or core system that can be utilized…...

3 Keys to effective loan review

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Posted by Sageworks

By Tim McPeak, Sageworks There will always be risks inherent in loan portfolios, and effective portfolio management and loan control functions are critical to the overall risk management function of banks and credit unions. The loan control function is typically spread over three functional areas within the institution: credit administration,…...

UCC revisions highlight ongoing guidance changes for financial institutions

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Posted by Sageworks

The first major changes in more than a decade to many states’ requirements for UCC (Uniform Commercial Code) filings took effect recently, highlighting one of the many credit-risk management issues that financial institutions deal with on an ongoing basis. Constantly changing rules and guidance can make it challenging for banks…...

Client service plans: Pairing client opportunities with accounting firm services

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Posted by Sageworks

In a recent video, Lauren Prosser, director of ProfitCents Professional Services, explains the first objective to prepare a meaningful client service plan.   In this brief video, Lauren explores the second key objective to a meaningful client service plan and how to pair the opportunities you identified and qualified in step one with…...

CPAs, don’t be “Just the tax guy/gal”

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Some accounting industry watchers warn business owners against relying on their CPAs for business advice, but many owners are apparently ignoring the advice. Most top U.S. accounting firms report that common sources of firm revenue growth include niche services such as business valuations, litigation support, strategic planning and business advisory…...

Next in line for stress testing requirements? Credit unions

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Posted by Sageworks

Last month, NCUA Board Chairman Debbie Matz indicated that the agency is drafting a proposed rule that would require credit unions with more than $10 billion in assets to complete an annual stress testing analysis. Credit unions’ largest banking counterparts, banks over $10 billion in assets, are already required to…...

Auditor switching tied more to relationship woes than to pricing

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Posted by Sageworks

Why do clients change audit firms? For years, accounting firms have lamented that audits have become commoditized, with clients leaving multi-year relationships because they were able to get a lower price. Indeed, some studies have found that a major reason clients switch is that they decide audit fees are too…...

Sageworks to host 2nd Annual Risk Management Summit in Nashville

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Posted by Sageworks

On Thursday, December 5th and Friday, December 6th, 2013, Sageworks will host the 2nd Annual Risk Management Summit at the Gaylord Opryland Resort & Convention Center in Nashville, Tennessee. It will