It is estimated there is a 30% to 50% reduction in the overall cost of the finance and accounting function when utilizing offshore outsourcing.
As the climate for mergers and acquisitions continues to improve, companies are returning to disciplined acquisition programs and are taking advantage of higher valuations for the sale of business units and non-core assets. Superior due diligence of acquisitions and packaging for divestitures requires a wide range of experienced professionals, industry and market knowledge, along with flexible but proven methodologies for gathering and evaluating information. In many cases, availability of in-house staff is scarce and the opportunity cost of using those resources is high.
Relevante’s professionals provide the experience and capacity to handle any or all aspects of your financial and operational due diligence needs. And while your team is working out the documentation, Relevante’s professionals assist in the post acquisition integration of key systems including ERP and CRM. When the deal is done, you and your newly acquired team hit the ground running. Or in the case of a divestiture, your financial and accounting systems and records are properly adjusted to carry on with your retained operations. Relevante not only provides the resources, but manages the project to assist you in delivering a recommendation to your governance committees or board; regulatory and securities compliance and testing; valuation analysis; financial systems and compatibility reviews; post acquisition system integration; and much more.
Relevante can provide the complete due diligence function for corporate development or investment groups that lack specialized staff and resources. Relevante’s partners and professionals are highly experienced in evaluating investments in companies and ventures of virtually any kind. Many accounting and financial firms evaluate only financial and accounting information. Relevante goes further to include evaluation of technology, marketing and operations; management strength and background investigations; assessment of operating and construction risk; investment structure, pricing and valuation; and contract and documentation review.
Whether for a single transaction that requires special attention or every transaction, Relevante can help. For more information on our due diligence services for merger and acquisition transactions or private equity investments, contact:
William Brassington, CPA
It is estimated that Chief Financial Officers now spend 15% to 20% of their time on Corporate Governance issues – 2 years ago this was estimated at 5% or less. It is also estimated that Fortune 1000 companies will need to spend 7500 to 25000 hours for this task, depending on size, number of locations, complexity, etc. In addition, companies expect additional spending of $500,000 for evaluation software, outside consulting and employee training.
Sarbanes Oxley has 2 main provisions we will cover in this article:
Section 302 requires that the Chief Executive Officer and the Chief Financial Officer of publicly traded companies must personally certify they are responsible for disclosure controls and procedures.
Section 404 mandates an annual evaluation of internal controls and procedures for financial reporting. In addition, the company’s independent auditor must issue a separate report that attests to management’s assertion on the effectiveness of internal controls and procedures for financial reporting.
The Section 404 provision has significant ramifications for publicly traded companies. It will and is requiring companies to look at their current controls and procedures and provide substantiation for the external auditor as to the adequacy of the control systems.
How are companies dealing with this enormous project?
Many Fortune 500 companies are engaging an outside provider, either a Big 4 Firm – (However, the current audit firm is not allowed to perform both the audit and the evaluation) or an outside consulting firm to provide a roadmap to meet this requirement. In addition, significant hours are needed by internal and external resources to document and implement any changes in control systems and hours by the external auditor to test the results and provide the report on the control systems.
Middle Market publicly traded companies are exploring handling the task with an internal Management Team group and rely on outside providers to assist with the implementation.
Many companies in both categories are exploring software tools and testing methodologies that will (i) simplify the process, (ii) demonstrate specific tests being conducted to give assurance to the audit committee’s that the company is being compliant, and (iii) pass an audit.
Testing of transactions that move to and from legacy systems and ERP systems are quickly being recognized as a critical area for consideration.
Relevante is here to assist you in dealing with the significant drain on resource this project will have on your accounting and financial team. Our team of accounting and technology professionals is poised and ready to work with and assist your team in the areas of documenting and implementation.
Why use Relevante?
We are focused on assisting our clients in this capacity and have been recruiting candidates to match the skill sets needed for the job.
Our resources are more cost effective than a Big 4 or similar consultative provider.
We will work with you to match resources with the deadlines you are facing.
We can provide experienced resources from project management, accounting and auditing experienced professionals, IT professionals and business process reengineering.
Finally, we work with both Fortune 1000 and Middle Market companies by assisting you in other ways, including backfilling positions within your accounting and IT team – allowing them to participate in the project – while our resources fill the positions of your full time employees. Finally, we commit to not remove our professionals during the life of the project.
The implementation of Section 404 applies to publicly traded companies for year-ends beginning June 15, 2004. We know you are gearing up now for this project. So contact Relevante and let’s discuss the many ways in which we can assist you through the challenges of Sections 302, 404 and other significant workload created by Sarbanes Oxley.
You may reach us at:
William Brassington, CPA
They are turning to firms like Relevante
Source: CFO Magazine April 2003 issue
As publicly traded companies begin to digest the full impact of the Sarbanes-Oxley Act of 2002, they are quickly realizing that the implications are enormous and so are the potential costs. Many are turning to a Big 4 firm that is not doing their audit to develop a blueprint for ensuring compliance with Sarbanes-Oxley. But once they have the blueprint, the cost conscience companies are looking at ways to manage the hefty rate structures of the Big 4 by integrating other capable professionals into their internal audit redesign and implementation teams.
They are turning to firms like Relevante
As a regional finance and accounting consulting resources firm that does not do audits and other attest work, Relevante is ideally positioned to assist clients with their internal audit needs and has been doing so rather successfully
Below is an example of a Relevante’s internal audit success:
Internal Audit – Compliance with Section 404 of the Sarbanes-Oxley Act of 2002
A publicly traded food manufacturer was embarking on becoming compliant with Section 404 of the Sarbanes-Oxley Act of 2002. The company needed help in documenting and testing the internal controls of a European subsidiary. They received bids from Big 4 firms and were looking for less expensive alternatives.
Relevante provided consultants whom the client felt were of equal quality to those offered by the Big 4 but at almost half the price. The professionals were fluent in the native language of the subsidiary host country and had significant experience performing IT audits, documenting and testing internal controls, and interfacing with external audit teams.
The consultants effectively assisted the client in meeting the needs of the new regulations while satisfying mandates from the company’s audit committee and demonstrating compliance to external auditors.
For more information on our services or to request a proposal or quote, please contact:
William Brassington or John McAvey
Relevante identified the need of organizations, large and small, to obtain specialized and qualified talent for projects without incurring full time equivalent costs. “We found that the increased regulatory and corporate governance issues have significantly increased the day to day tasks of many finance and accounting departments. Consequently, improvement projects are getting delayed or cancelled.” Relevante provides the skilled resources to execute” said founder and CEO William Brassington.
In its first six months of operations, Relevante has initiated over ten engagements. These include: