Accounting

Few, if any, articles on finance that have appeared in HBR have enjoyed the influence of the 1962 article reprinted here as a “Classic.” Gordon Donaldson’s analysis of how many companies haphazardly established their debt capacity, and his careful explanation of what he considered a better way, seemed to strike a chord among corporate administrative […]

Extreme uncertainty can tempt an organization to abandon budgeting. Consider your options instead.

Less than a decade after the frantic merger activity of the late 1960s, we are again in the midst of a major wave of corporate acquisitions. In contrast to the 1960s, when acquirers were mainly freewheeling conglomerates, the merger movement in the 1970s includes such long-established giants of U.S. industry as General Electric, Gulf Oil, […]

A new initiative, the International Sustainability Standards Board, holds promise.

Why is it that effective business start-ups frequently grow into corporate giants, but effective new nonprofits rarely reach national scale? Because,...

The subject of transfer pricing doesn’t normally excite many people, but when your transfer pricing system is less than perfect, life gets interesting. We at Bellcore first got interested in transfer pricing in 1983. That’s the year before AT&T was broken up and Bellcore was being formed as the centralized organization supporting the seven regional […]

Employees are constantly in motion—making sales calls or taking service trips; visiting an international office for a few days or relocating there for a few years; soaring across oceans in the corporate jet or heading across town in the company car. Typically, these activities are administered by an assortment of departments and vendors. But we […]

Too many CEOs are penny-wise and pound-foolish.

In the last year, war broke out, the economy took a nosedive, and an alarming number of businesses went belly up. Thus, it is with some urgency that we...

On July 30, President Bush signed into law the Sarbanes-Oxley Act addressing corporate accountability. A response to recent financial scandals, the law...

How the three Fs-facts, faith, and fortitude-can create a persuasive business case as well as a roadmap for new initiatives.

Despite Sarbanes Oxley, corporate executives still seem awfully good at keeping their boards in the dark. I find it hard to blame board members, though....

This article presents the research findings of a leading U.S. corporation, AT&T, on a series of important economic questions and issues, with an interpretation of the material by one of the company’s top executives. The subject is corporate earnings patterns in different industries, investment trends, the relation of profits and investment to GNP, and other […]

A wounded-but-wiser AT&T veteran recounts how one of the world’s biggest and best-known companies became one of its most battered—and explains how others can avoid that fate.

In recent years, companies have reduced their dependency on traditional accounting systems by developing, activity-based cost management systems. Initially, managers viewed the ABC approach as a more accurate way of calculating product costs. But ABC has emerged as a tremendously useful guide to management action that can translate directly into higher profits. Moreover, the ABC […]

Measuring the value of intangible assets such as company culture, knowledge management systems, and employees' skills is the holy grail of accounting....

Steady, predictable growth is what every big company strives for, and what investors prize above all else. McGrath set out to discover how many companies...

When blockbuster drugs give way to generics, pharmaceutical companies like Novartis must find new ways to grow.

Sarah is a director of a Real Estate Investment Trust whose CEO has expressed his admiration of her intellect and drive for information, but board meetings...

Many companies now recognize that their cost systems are inadequate for today’s powerful competition. Systems designed mainly to value inventory for financial and tax statements are not giving managers the accurate and timely information they need to promote operating efficiencies and measure product costs. In response, they have tried to redesign their present systems, but […]