Coca-Cola wants you to believe that its sugary drinks are not the cause of health problems for Americans, such as obesity or Type 2 diabetes. Instead, the beverage maker has sponsored its own research, which points a finger at a sedentary lifestyle, with the best science money can buy. Here’s what your business can learn from it.

Over the past several years, Coca-Cola has donated millions of dollars to the Global Energy Balance Network (GEBN), a non-profit that is attempting to redirect the conversation on America’s obesity crisis.

In a recent video announcing the new organization, GEBN’s Vice President Steven N. Blair, had this to say: “Most of the focus in the popular media and in the scientific press is, Oh they’re eating too much…blaming fast food, blaming sugary drinks…there’s really virtually no compelling evidence that that, in fact, is the cause.” Coca-Cola would prefer those looking for answers to America’s obesity epidemic to focus more on exercise habits (or lack thereof) than calorie consumption.

Coca-Cola’s funded research and statistical analysis of the obesity problem in America may have more in common with mistakes businesses make in their performance measurement practices than you think.

If you try hard enough, you’ll see what you want to see (and ignore the rest). GEBN’s Blair maintains that a lack of data exists to place any blame on sugary drinks: “We want data…not just any data, actual data.” Never mind the excess of evidence pointing to the contrary. Winston Churchill famously said, “I only believe in statistics that I doctored myself.” Many business’s fall into the trap of focusing on KPIs that put their performance in the best light possible, omitting metrics that may paint a “not-so-bright” picture.  Organizations must establish clear strategic and operational goals and choose the KPIs which best reflect those goals, regardless of how good or bad they look.

Bad decisions are based on bad metrics. Funding from the food industry is not uncommon in scientific research. A recent analysis of beverage studies found that those funded by Coca-Cola, others in the beverage industry were five times more likely to find no link between sugary drinks and weight gain than studies whose authors had no financial conflicts. A good corporate strategic plan includes a solid set of accurate, reliable, and accountable KPIs that can translate strategy into manageable operational actions.

With over 25 years’ experience consulting with industry-leading companies, Talley & Company and our affiliate Group 11 Advisors are committed to provide clear, knowledgeable and applicable financial data and analysis solutions, enabling management to intelligently track performance, progress and profits. To determine whether your business is taking advantage of all metrics available to make the most informed decisions for future success, schedule a time to talk with us today.

In a landmark agreement, Iran and six world powers have reached a deal to lift sanctions that have been in place for 12 years, in exchange for the nation’s agreement to limit its nuclear program. While both supporters and critics alike consider the agreement historic, many argue that the U.S. may not be on the best side of the deal. Here’s our take on what the Iran nuclear deal can teach us from a business perspective.
Robert Gates, former Secretary of Defense for George W. Bush and Barack Obama, made it clear he felt the nuclear agreement left much to be desired from an American position: “We must now face the reality that there are serious consequences to voting down the agreement or pulling out of it,” he said. “I think we swallow hard, acknowledge our negotiators got out-negotiated, and that we have a flawed deal, and make the best of it.”
Let’s hypothetically apply these comments to a business transaction. Does this sound like a deal that you would want to be on the wrong end of? Probably not.
While we are not discounting the argument that a deal of this magnitude and historical significance has its own playbook and set of rules, what transpired in the US-Iran negotiations can be illuminating to those involved in any type of business transaction.
Getting a deal done is easy, but getting the right deal done is a challenge.
  • Always keep the original strategy in front. Yes, closing a deal is ultimately a transaction and there are mechanical details that need to be handled. But don’t sacrifice the original strategic intent for expediency in getting the deal done.
  • Don’t “need” the deal. If you are in a negotiation and you give the other party the impression that you must make this deal, you may be at a huge disadvantage at the negotiation table.
  • An agreement is only as good as the parties signing it. Many commentators have pointed out that the key to the Iranian deal is trusting Iran to stick with the deal. As in business, it’s essential to assess levels of trust throughout a negotiation and factor it into the structure of any deal you hammer out.
Only time will tell if this remarkable deal will stick and bring about the benefits hoped for by all the parties concerned, however these insights are worth remembering before you enter into any buy/sell transaction.  Talley and Company has negotiated hundreds of M&A transactions and can help you make the most of a transaction based on your goals and priorities. 
When Maurice Laboz, a New York real estate mogul, died earlier this year, he bequeathed a generous fortune to his daughters, but with strings attached. Though each of his two daughters are to receive $10 million upon turning 35, he set up conditions in his will where the payouts could start earlier. Though setting aside money with stipulations is nothing new in the realm of estate planning, Laboz’ terms and conditions for an early pay-out to his daughters warrant a closer look.
For example, one of his daughters, Marlena, will receive $500,000 when she marries, “but only if her husband signs a sworn statement promising to keep his hands off the cash” according to the New York Post. She will also receive an additional lump sum of $750,000 if she graduates from an accredited university and writes a paragraph (100 words or less) about what she proposes to do with the money. Marlena’s “essay” must be approved by the trustees Laboz appointed to oversee the monies disbursed to his daughters.
In a post-mortem effort to incentivize his children to find gainful employment, both of Laboz’ daughters stand to receive a check worth three times the income listed on their personal tax returns each year from their trust if they decide to work. If they choose not to be employed and decide to have children instead, they will receive 3% of the value of their trust each year, granted the child is born in wedlock.
How’s that for parenting from beyond the grave?
All joking aside, while Talley & Company and our affiliated partners do not advise anyone attempt to be this “creative” with their estate planning, Laboz’ case exemplifies the amount of control individuals have when deciding what to do with their assets in the event of incapacity or death. Though the options are virtually limitless, proper estate planning -deciding on the “who, what, when, and how” and executing this with the least amount paid in taxes, legal fees and court costs possible can be a challenging affair to wrestle with alone. For more information, contact Talley & Company today.

This week Amazon’s market cap jumped nearly $40 billion to $264B, surpassing Wal-Mart’s $233.5B.  The e-commerce giant surprised many analysts by posting a net income of 92 million in the three months ended June 30, a startling jump compared with their net loss of $126 million in the same period a year ago. Though Wal-Mart still generates more sales than Amazon ($485.B in the last 12 months compared to $95.8B), the e-commerce giant passing Wal-Mart in terms of value in the eyes of investors represents a major milestone for Amazon.

Until fairly recently, the majority of the horse race between Amazon and Walmart has been a battle of complete opposites, with both chains dominating their historic areas of expertise.

Launched in 1995, Amazon began as an online bookstore before diversifying its product lines by adding virtually anything you would ever consider buying. Amazon’s online sales are more than the combined sales of the next 10 biggest online sellers, which include Wal-Mart and Apple. Considering the success of the Amazon Prime’s $99/year subscription that includes free two-day shipping and access to an extensive music, television and movie library and initiatives such as Amazon’s Fresh same-day delivery of groceries, its not hard to see why they are biggest .

Though Walmart relies heavily on their brick-and-mortar stores to drive revenue, Walmart has demonstrated that it is a company that knows how to leverage technology, evidenced by its state-of-the-art inventory and distribution system that is vital to its low-price positioning. Wal-Mart’s technological prowess was key to the way the company’s transportation and logistics systems were pressed into action after Hurricane Katrina.

You can bet that these two retail giants are not resting on their laurels and that may be the biggest takeaway from all of this:  Even if you aren’t Amazon or Wal-Mart, evolving and innovating is necessary to stay ahead of the competition.

Leading-edge businesses are partnering with Talley & Company and its affiliates to take advantage of our wide range of services, such as bookkeeping, financial reporting, technology advising, tax planning, and estate planning. Talley & Company can help you design and execute fully customizable solutions to fit the unique needs of your business.

In a landmark estate tax settlement the IRS netted $388 million in a record settlement with the estate of Bill Davidson, a noted philanthropist and owner of the Detroit Pistons, the WNBA’s Detroit Shock and the NHL’s Tampa Bay Lightning. The IRS claimed an astounding $2 billion deficiency of estate/gift/generation-skipping taxes with the former Pistons owner’s estate. To put it perspective, the Treasury took in a total of $12.7 billion in estate tax revenue in 2013. Where did Davidson go wrong?

Here’s the quick breakdown in dollars: $187 million in gift taxes, $152 million in estate taxes, $49 million in generation-skipping taxes, and a $133,000 gift tax penalty.

The IRS took note of two main issues that led to the deficiencies:

The estate undervalued corporate stock. The IRS claimed the estate reduced the value of privately held Guardian stock held in trust for children and grandchildren. Estates with hard-to-value assets such as privately-held stock, real estate or art need to pay close attention to the valuations for gift and estate tax purposes.

The estate also improperly valued self-cancelling installment notes (SCIN’s). Although they are a well-recognized means of tax mitigation, the IRS questioned the computations Davidson employed and claimed Davidson was making taxable gifts he should have reported. The IRS takes a tough stance on how you value the notes and what you need to do to establish that it’s a fair exchange of assets for the notes.

You don’t have to a part of the “Billionaires Club” to face estate planning challenges. Any individual or family with a business, real estate holdings, household property, liquid savings, or stock investments will want to establish a thorough estate plan before unforeseen circumstances intervene. The only way to make sure more of your money is transferred to the people and causes you care about (over the IRS) is to plan for it with your advisors. Talley & Company is here to help.

The FBI and Justice Department are investigating whether or not officials associated with the St. Louis Cardinals gained unauthorized access to networks belonging to the Houston Astros, a rival baseball team. If the accusations hold true it would represent the first known case of corporate espionage through network hacking between professional sports teams, according to The New York Times. And it all happened because of poor password practices.

The cardinal rule of passwords: They should be unique, secret, and changed often. It appears Mr. Luhnow ignored these principles and simply reused the network passwords he used at the Cardinals for his new program at the Astros.

The Cardinals’ front office might have used Luhnow’s old Cardinals network password to access the Astros’ network after Luhnow’s departure. Through this access, the Cardinals could have obtained valuable inside information about the players the Astros are looking to recruit, potential offers and opened doors to poach desirable recruits with counteroffers — potentially changing the course of the season.

Most people associate cyber espionage or data breaches as a complex endeavor involving malware, Trojans, phishing attacks and teams of hackers that target “big business” and the government. That misconception is the result of the media’s focus on high-profile data breaches involving large corporations and government organizations, but the truth is that it is a larger problem that affects all organizations, both large and small.

Many small and mid-sized organizations have a limited understanding of the complex digital environments they’re dealing with and the repercussions of not properly protecting themselves against online threats: Cybercrime costs businesses $445,000,000,000 each year, with most of the damage done in the aftermath of an attack. Potential fines, loss of revenue, and hiring people to fix security issues can have a serious impact on a company’s bottom line, especially given the fact it takes an average of 32 days to resolve a single cyber-crime incident.

It’s critical that organizations recognize the importance of both the technical and human elements in establishing security solutions, procedures and policies, regardless of industry or size. To find out more about how Talley & Company has helped its clients with technology solutions that secure, protect, and enhance their businesses, give us a call today.

Donald Trump wants to make sure you know these two facts: he is a very rich man ($4.1 – $8.7 billion rich depending on who you ask) and that he is the wealthiest presidential candidate for 2016. “I have a total net worth of $8.73B,” he said. “I’m not doing that to brag. I’m doing that to show that’s the kind of thinking our country needs.” But does that mean Trump has enough money to make a legitimate run for President in 2016?

Trump’s wealth matters because rather than rely on rich donors and Super PACs who will ask for future political favors in return, Trump plans to pay for his own campaign run.

Amazingly enough, Trump might not have enough cash to finance a presidential campaign by himself if he plans to compete against the likes of front-runners Hilary Clinton and Jeb Bush.

To put it in perspective, President Obama and his supporters spent $1.1 billion to win in 2012, while Romney spent $1.2B in his losing effort. In both cases, Super PACs and donors were responsible for funding a significant portion of their campaigns.

Fast forward to the 2016 election: Preliminary reports estimate that total spending for the Republican and Democratic nominees’ campaigns could reach $2 billion each.

According to his recently released financial summary, Trump has $302 million (what a paltry amount, right?) in liquid assets. It’s certainly a lot of money, but not enough to run a successful campaign. Most of Trump’s wealth appears to be tired up in real estate, business partnerships and endorsement deals. Those assets, while contributing to his net worth, would do little good unless Trump plans to liquidate or borrow against them.

Yes, even one of the richest men in the world might find himself in the capital market looking for help financing his campaign if he decides to go it alone. And like any type of capital acquisition/growth strategy, it could prove to be a complex venture to undertake.

Regardless if you are planning to run for President or not, Talley & Company knows how critical funding a business’ growth is to entrepreneurs and family-owned businesses. We are here to help connect you to the right lender or equity group to fit your unique growth plan, present your company’s financials and “story” in a manner that increases favorability with lenders or equity groups and structure the transaction in the most tax-efficient manner.

For more information about how Talley & Company can help you plan, negotiate, structure and execute on your growth strategy, contact us today.

With almost 400,000 employees worldwide and holding more patents than any other U.S. based tech company, IBM is one of the most recognized brands in business innovation. In 1964, IBM solidified its place in the tech industry, producing approximately 70% of all computers, but has struggled in recent years due to missing a key technology shift in an increasingly mobile and online business environment. Though IBM has made strides to keep up with the times by shedding low-margin hardware products and re-inventing itself as a business technology solutions provider, sometimes even those in the business of innovation can fall victim to the status quo.

IBM Bans Uber. Earlier this year, IBM issued a firm-wide ban on reimbursement for use of Uber and other ride-sharing services over safety and security concerns, noting that such services might carry inadequate insurance, fail to conduct background checks on drivers and were even illegal in some cities.

IBM’s ban on ride-sharing services did not sit well with Max Black, a global business consultant with the company and early adopter of Uber rides for business travel. He posted a petition on IBM’s internal social network, arguing that Uber saved IBM money, improved accountability and was not a safety risk.  His final point struck a major chord with IBM’s top brass: “We are being hypocritical…IBM is in the business of preaching mobility transformation to its clients, but we are effectively outlawing for our employees one of the best examples of mobile innovations.”

Within hours, hundreds of comments from fellow co-workers flooded in, expressing their unanimous support for IBM to lift the ban on Uber. The result: 16 hours later, head of HR and senior VP Diane Gherson reversed the ban on ride-sharing services.

The real lesson? Don’t let the status quo impede innovative thinking.  Accept that complacency is a business killer and be open-minded when looking at new processes, procedures and business tools that challenge the “we’ve always done it this way” mentality.

Leading-edge businesses are partnering with Talley & Company and its affiliates to take advantage of our wide range of services, such as bookkeeping, financial reporting, technology advising, tax planning, and estate planning. Talley & Company can help you design and execute fully customizable solutions to fit the unique needs of your business.

When many think of the millennial generation, the scourge of “selfies” and entitlement come to mind. –But regardless of your feelings towards them (good or bad), Millennials represent the next generation of managers and key personnel to many middle-aged entrepreneurs as they start to wind down and think of retirement.

Integrating Millennials into a Baby Boomer culture is a big challenge for business.  So how do we manage their expectations while maintaining high performing organizations?

Many entrepreneurs and executives will tell you their number-one mistake is hiring the wrong person for the job. This crippling error can be avoided if you’re in tune with the strengths and culture of your organization and how others can “plug into” the system already in place. As with any small organization or startup, it’s critical that every person is right for their job. So how do you ensure you’re hiring the right millennials?

A strengths assessment of your existing personnel is an ideal place to start. Think of it as a SWOT analysis on your most valuable resource — your people. It identifies key personality and behavioral traits and can help you understand how to best leverage the combination of those talents and how to add to them by finding the right people to hire.

Start with the “Why”. A lifelong career with work/life balance may have been a goal for previous generations but it is not as enticing to millennials. In order to capture their passions, start with why they should care.  Why does your company exist? How can they contribute? By articulating this and making sure they have a sense of purpose in your organization, you can ensure they find meaning in their work efforts and stay engaged.

Take note of Millennials’ affinity with the digital world. Millennials can’t imagine a world without constant social media updates and 24/7 WiFi. This generation is 100% plugged in and expects instant access to information and the world around them. This extends into their worklife: They want to be able to work from wherever they happen to be at the time. Many companies are starting to see the value of this and are transitioning to cloud-based platforms, allow employees to set up shop and work wherever they may find themselves.

Hiring is undoubtedly one of the biggest challenges companies face, and, at the same time one of the most rewarding opportunities. Executing it well the first time will help you avoid costly & time-consuming repercussions and have a positive impact on your existing team. Talley & Company and its affiliates offer staff assessment & educational tools that provide business owners a complete picture of what skills and expertise their administrative personnel have and what they need to succeed. To find out more about how Talley & Company can help your business grow, contact us today.

The National Football League recently gave up its tax-exempt status, a designation that saves the organization about $10 million each year, according to the Citizens for Tax Justice. Measured against the billions the league makes annually, this is a drop in the bucket for the sports superpower. Still, $10 million is, well, $10 million. So why would an organization voluntarily expose itself to the obligation of making tax payments?

The answer is, we believe, PR and privacy. To be clear, the tax-exempt status the NFL enjoyed only applied to the league office itself, not the 32 teams, who have always filed taxes. For years, the league has been heavily scrutinized by the media for its 501(c)(6) designation status. The idea that a mega-revenue-generator could be allowed to sidestep taxes, legitimately or not, is easy fodder for the news media.

With this designation under the IRS code, the organization is required to disclose top salaries paid. That means NFL Commissioner Roger Goodell’s salary of over $35 million in 2013, $13 million higher than the top paid player, is public knowledge. This information has only exacerbated intense criticism of the league at a time when its image is still on the defense as a result of the Ray Rice scandal, among others.

At a news conference at the NFL annual meeting, Robert McNair, chairman of the league’s finance committee, told the press, “The owners have decided to eliminate the distraction associated with the misunderstanding of the league office’s status, so the league office will in the future file returns as a taxable entity.” Major League Baseball made the move to give up its 501(c)(6) status and eliminate this “distraction” back in 2007, and the National Hockey League may someday decide to follow suit.

The lesson in all of this, to those of us who don’t run a national sports league, is that potential tax savings alone should never be the most important factor to making a major life or business decision. Chasing after the biggest refund to save a few dollars and cents now could have bigger, more significant consequences down the line.

In the end, it looks like the NFL decided saving a few dollars wasn’t worth the cost to the league’s reputation and brand. And, well, it will probably be able to find plenty of other ways to minimize its tax bill, now that it can write off a long list of business expenses as a taxable entity.

The end game is that the decision was probably made after looking at the cost/benefit scenario from multiple angles. High-net-worth individuals are advised to take the same approach with their own assets, considering tax-saving maneuvers from a 10,000-foot-level to understand potential liabilities and benefits.


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