Combining Liquidity and Efficiency Metrics

How long does it take your company to convert raw materials to cash collected from customers? The cash conversion cycle is a financial metric that answers this critical question. Here’s a closer look into how it’s calculated and what it means. Liquidity vs. turnover Liquidity ratios tell whether the company’s current assets are sufficient to […]

Spotlight on the Research Credit

After being continually renewed since the 1980s, the research credit was finally made permanent under the Protecting Americans from Tax Hikes (PATH) Act. This change allows manufacturers to plan (with certainty) for their R&D expenditures. And it’s expected to survive any tax reform legislation that will pass in 2017. Here’s an overview of the current […]

How to Reduce Waste

Scrap materials sometimes pile up on the shop floor, especially when a plant ramps up production to meet peaks in demand. Excess scrap can lead to safety issues and cleanup costs — but waste extends beyond trash in a manufacturing context. Here’s an expanded definition of “waste” and some cost-effective ways to help reduce it. […]

Get Ready to Roll Out the New Accounting Standards

Two major accounting standards rule changes will soon go into effect — and they’re expected to have major impacts on how many manufacturers and distributors report their financial results. Here are the details, including what’s changing, when the changes must be implemented and how they’ll affect financial statements. A new lease on leases Of the […]

Checking the Backgrounds of New Hires

An average of 178,000 employees per month were added to the payrolls of employers in the United States in 2016, according to an “Employment Situation Summary” released in December by the U.S. Bureau of Labor Statistics. And the pattern of a significant number of new hires per month is expected to continue into the New […]

Attention Partnerships: Changes

Is your dealership structured as a partnership? If so, or if you’re considering transferring property to a partnership, take note of new IRS regulations that took effect October 5, 2016. Section 707 disguised sales It’s common for a partner to contribute appreciated property to a partnership and for a partnership to distribute cash or appreciated […]

Words Matter When Selling Vehicles

Selling vehicles can be tricky. When talking to customers about vehicles they’re considering buying, salespeople can boost the chances of making a sale by using certain words to describe vehicles — as well as not using other words. This is one of the findings of research conducted by CDK Global, which provides IT and digital […]

Customers In, Customers Made Permanent

More than 8.4 million airbags have been replaced at auto dealerships and other auto repair facilities during auto recalls over the last two years, according to the National Highway Traffic Safety Administration, and replacements continue to be made. The massive recall of defective airbags from a Japanese supplier was launched in 2015 after numerous vehicle […]

The Future of Autonomous Vehicles

When many people think of self-driving or autonomous vehicles, they envision futuristic, Jetsons-like cars gliding above the surface of roads. But autonomous vehicles are already here — they just don’t fly. Prototypes on the road A number of prototype autonomous vehicles have been introduced, including the Tesla Model S and the Google Self-Driving Car (or […]

Beware of UDAAP

The Consumer Financial Protection Bureau (CFPB) continues to exercise its authority to crack down on banking practices it views as unlawful under the Dodd-Frank Act’s regulations on unfair, deceptive or abusive acts or practices (UDAAP). In one recent enforcement action, for example, the agency entered into a $28.5 million settlement with the Navy Federal Credit […]

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