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March 9, 2016

CBIZ MHM Tampa Bay will host an inaugural half-day CFO & Controller Conference focused on the CFO’s role in mergers and acquisitions.  As a result of the significant role that mergers and acquisitions play in corporate growth strategy, the function of the CFO has greatly expanded.  This dynamic environment demands that the CFO play a strategic role in providing financial perspective, building partnerships, and working closely with chief executives and board members.

The event will take place May 11th at USF Health, Center for Advanced Medical Learning and Simulation in downtown Tampa.  The conference will qualify for 4 hours of CPE credit.  Pre-registration is required, and attendees can register now online for a fee of $50, which includes the cost of the conference, breakfast, lunch, and parking. 

For more information and to register:

Stay tuned for future posts about our presenters and topics leading up to the event.

March 4, 2016

Over the next six months, the Memphis office is focusing on different specialties and services by featuring a Q & A with one of our local experts each month.

Josh Finfrock serves as a Director and leads the transfer pricing practice for CBIZ & MHM Memphis.  Josh has significant experience providing guidance on the development of internal transfer pricing policies and on the development of planning and documentation strategies for multinational clients operating in various countries worldwide.

Not only does this series allow you to get to know Josh on a more personal level, but he also answers important questions like “What should be in consideration as you're doing business internationally?”  The conversation continues with Josh discussing the common issues he finds, consequences of companies not in compliance, and why it’s important for transfer pricing to be controlled and monitored.

More resources featured on Josh’s Conversation page include previously featured articles, a BizTip Transfer Pricing video, and information on the latest CBIZ MHM Executive Roundtable Series.

Read the full conversation by clicking here.

March 4, 2016

This morning the Kansas City CFO group met for their first quarter event , entitled “How to Finance Your Business: A discussion with Kansas City’s local banks & non-traditional financing resources”, featuring a panel of financial experts including Mike Maddox, CrossFirst Bank, Cory Miller, UMB Bank and Mike Roznowski, Fractal Capital Advisors.

The panel discussion focused on the current state of the lending environment, as well as the financing options available at varying risk levels. The panel fielded a variety of questions including how the new rules and requirements surrounding HVCRE will affect the real estate market, trends in pricing and leverage multiples, personal guarantees, covenants and the new guidelines regarding leverage loans and the impact on credit decisions moving forward. 

A few key notes: 

How should a CFO prepare, to present their company in the best possible light when meeting with a lender?

Mike M: “Be organized, prepared and ready to talk about your company and what’s going on.”

Cory: “Be responsive, as the finance executive, it’s important to be responsive when receiving questions from a lending source. For example, if you are taking too long to respond to emails containing financing questions, it may add unnecessary skepticism to how much of a handle you actually have on your business.”

Mike R: "From an alternative funding perspective, companies seeking this option have often been turned away by the bank(s) for one reason or another – clearly getting those hurdles out front early, so we can work together to move forward, is key."

What should a CFO look for / consider when seeking a financial resource?

Mike M: "Do your due diligence on the source and consider the four C’s. Does your source have character?  Are they committed to the market and industry you are working within? Are they competent in your business, your industry and your growth potential and most importantly, do you connect?"

Mike R: "Adding on to Mike’s comments, the connection and commitment are key – it’s imperative you understand how the lender is going to behave if everything doesn’t go exactly as planned."

Cory: “Use your peers. Your CPA and Attorney have those banking relationships and understand how those resources work. You want to make sure you have a good relationship and connection with whomever you choose, so that you can work through those unexpected bumps in the road.”

Save the date for the second quarter Kansas City CFO Breakfast event on June 2nd, featuring Greg Graves. Look for more information in your inbox in the coming months! 

March 2, 2016

As a sponsor for this event since its inception, CBIZ MHM’s Linda Lauer welcomed the group sharing the value of women in our workplace.  Linda also noted the national firm’s development of business women through our Women’s Advantage program.

Carolyn Hardy of Chism Hardy Investments and Henderson Worldwide Investments headlined as the keynote. Working among ‘the good old boys’, she quickly realized the importance of using her relationships to her advantage. During her address, Carolyn spoke about how women should utilize their connections and “human collateral” to advance in their business endeavors, noting that “you will never make a sale if you call the receptionist.”

Overall, the group discussion was very empowering.  Many panelists discussed how women in business should lift each other up by partnering with one another rather than competing among the few women already in the room.

Other panelists included Sara Burnett from LeBonheur Children’s Hospital, Stacy McCall of ServicesMaster by Stratos, and Sarah Petschonek of Volunteer Odyssey.

A crowd of 200 gathered for the #BIZWomen event at the Brooks Museum. To read further coverage, view the Memphis Daily News article.

For more information about CBIZ Women's Advantage, click here.

(picture courtesy of Memphis Daily News/Andrew J. Breig)

March 2, 2016

One of the first items a potential buyer for a business will want to talk about is the organization’s financial performance. Dave Enick, Tampa Bay Managing Director, co-authored an article discussing step two of a five step process to selling your business. This step covers collecting, organizing and examining a company’s financial indicators in preparation for the due diligence phase of the sale process.

A professional financial picture makes your business much more attractive to buyers. A special focus should be on documented, clearly understood, and applied historical accounting reporting policies and procedures in the business. Sellers should be prepared to present monthly trial balance or similar financial information prepared in accordance with GAAP. A key area of focus will be a reconciliation of revenue and sales reports to the financial statements.

It is important to analyze this data over at least a few years to pinpoint patterns in spending or expenses.  The historical cash flow projections will help with present and future cash flow projections.

Additionally, it is important to consider add-backs, marketplace considerations, and the way your organization is structured.

For more information about the five step process and organizing your financials, contact Dave Enick at denick@cbiz.com or 727.572.1400.

February 29, 2016

Can compensation paid to a hospital-employed physician be Fair Market Value (FMV) when the hospital loses money on the professional practice?

Recent government interest in the topic, as well as ongoing debates on the applicability of the Income Approach when valuing physician compensation, have highlighted the need to address this question. This article will explore the complexity of the issue, including some of the reasons why practice losses occur and focus specifically on the impact that operating in a quasi-regulated industry has on the determination of FMV.

Market Dynamics Impacting Physician Practices

Understanding the market dynamics impacting physician practices is an integral part of identifying why practice losses occur and how FMV is implicated when a hospital is subsidizing physician compensation.  Below are four important market factors that affect the finances of a physician practice.

Aging Population
Advances in healthcare have led to an increased life expectancy for Americans, and we now face an aging population. With an aging population comes an increased demand for healthcare services. While increasing life expectancies is positive; it does put a strain on healthcare resources. 

Supply and Demand of Physicians
Over past decades, the supply of physicians has not been able to keep up with demand. Now, the Affordable Care Act (ACA) has increased the number of insured patients, further increasing demand for healthcare services. One recent study reported a shortage of 46,100 to 90,400 physicians by 2025. The market is responding with non-physician practitioners, such as nurse practitioners and physician assistants; however, the demand for physicians will continue to exceed the supply. 

Hospital Employment Physician Practices
Over the past decade, there has been a substantial swing from private practice groups to hospital employment. Many financial changes occur when a hospital operates a physician practice. While these changes often have a positive financial impact, such as improved insurance contracts or bargain purchasing power for certain supplies, other changes often increase the expenses of the practice, such as increased salaries and benefits and overhead allocations from hospital departments. In addition, a hospital may choose to move certain services previously offered by the practice to another department of the hospital, whereas private practices take advantage of the in-office ancillary exception and often realize a profit from those ancillaries. Private practices must “break even” to stay in business; however, hospital-owned practices are merely a department or subsidiary of a larger operation and do not necessarily have the same economic restrictions.

Government Payers
Medicare is the most significant payer for many physician practices. It is the rare physician practice that can survive without participating in the Medicare program. But, Medicare reimbursement rates are not negotiated like other payers; they are regulated by Congress.  Sequestration and other government imposed sanctions increase the pressure on available dollars to fund Medicare. Recently, a budget deal was struck to keep the federal government functioning and depends largely on Medicare cuts. Additionally, government payers, such as Medicare and Medicaid, are typically the lowest payers in a market. Changes in Medicare do not only impact government payers in the long run; Medicare largely sets the reimbursement for much of the healthcare market.  Commercial insurances often index their fee schedule to the Medicare fee schedule, so when Medicare cuts rates, the commercial insurances presumably will follow.

Each of the above dynamics can contribute to physician practice losses. Valuators have an obligation to gain an understanding of a client’s business and industry, including the dynamics listed above. As such, each of the above market factors can significantly impact a FMV analysis. Below, we will discuss the resulting implications for FMV.

Impact on FMV

The aging population, coupled with the supply and demand for physicians, creates a significant amount of pressure on the physician practice model. Traditional market theory of supply and demand does not hold true in physician practices, due primarily to a regulated reimbursement model. As previously discussed, demand for physician services is exceeding supply. The increase in demand is reflected in market data traditionally used to value physician compensation, but is not reflected to the same extent in the government reimbursement. Further, the aging patient base that is creating much of the demand is increasingly covered by Medicare. Unfavorable payer markets and the requirement for hospitals to treat patients regardless of their ability to pay further increase the volume of Medicare, Medicaid, and uninsured patients. This will generally lead to lower reimbursement, leaving less money available for physician compensation, and potentially leading to losses at the practice level.

The question remains: can physician services be supported as FMV even when practice losses are incurred? In attempting to answer this question, we must consider how FMV is determined. Valuators are required to consider all three primary valuation approaches: the Market, Income, and Cost Approaches, and then use professional judgment to determine the applicability of each. 

As healthcare valuators, we have historically been somewhat limited to the Market Approach for physician compensation valuations. With the inapplicability of the Cost Approach, along with the issue of physician practice losses, ultimate reliance on the Market Approach is commonplace. However, ultimate reliance on the Market Approach does not diminish the importance, or responsibility, of considering the Income Approach.

The application of the Market Approach alone results in compensation driven by market data without consideration for the economic impact on the hospital or practice. This creates risk, as inappropriate application of the market data causes self-perpetuating increases in physician compensation without regard for the impact on the hospital. 

Conversely, in situations where a hospital is incurring a loss on a physician practice, sole reliance on the Income Approach would not be adequate to support competitive or FMV physician compensation. However, many valuators feel singular reliance on the Income Approach in such a situation would not result in an appropriate indication of FMV, due to the market factors and restrictions discussed above. Assuming the employing hospital has sufficiently documented the community need for the physician’s professional services, and physician compensation can be supported as FMV under the Market Approach, it may be appropriate to place little to no reliance on the Income Approach in a final conclusion of value. 


Valuators, attorneys and the government have all considered the implication of practice losses on FMV, and the theoretical debate is sure to continue. The facts and circumstances of each market and each individual transaction between a hospital and physician should be carefully considered in conjunction with practice losses and the Income Approach to value. Proper documentation of factors such as community need, physician supply and demand,  and the history and ability to recruit in a particular market are just a few of the factors that should be analyzed when determining the FMV of physician compensation and the appropriate consideration of the Market or Income Approaches.

February 29, 2016

Originally published on Startland News

You know the feeling you get when you find $20 in your pocket that you forgot was there?

Or have you seen the late-night infomercials about all the “found money” just sitting around waiting for you to claim it?

It’s exciting stuff — the kind that makes your pulse race and your mind wander to the endless possibilities available to you and your newly found money. But then the nagging voice in the back of your head questions, “Are there other savings opportunities I may be missing out on?”
As a startup, you may be overlooking something more lucrative than that extra $20. It’s called a Research and Development (R&D) tax credit and may even result in CASH!

The Basics: Beginning this year, startup companies with gross receipts of less than $5 million may elect to claim the R&D credit against payroll tax liabilities. Congress wants to encourage companies to remain persistent in developing new products and has created a way for companies investing in these activities to save money.

Almost any for-profit company working on new products or processes may qualify, regardless of whether the company is currently making money. Specific items might include software application, new tangible products or even upgrades to older products. Another great indicator is if you have engineers, computer programmers or other technicians on staff.

Who qualifies: We won’t go into the specifics of the calculation here, but basically, if you’re spending money on personnel and outside professionals to research a new product or platform, you’ll likely qualify for the credit.
The hardest thing for most companies is trying to compile all the research and development costs at the end of the year. While all good companies track spending, they don’t necessarily track costs for specific types of tasks, so when it comes to the end of the year, it may be difficult to accumulate the actual research costs incurred.

The best thing to do is make sure your accounting platform is setup to capture these costs as they occur. Understanding what type of costs can go toward the credit is critical to maximizing the accumulation. For example, does an administrative assistant helping a computer programmer compile data qualify? The answer to that and similar questions depends on the business.

The Bottom Line: Now is the ideal time to talk with your accounting and tax advisors to guarantee you are taking the proper steps to ensure you don’t leave money on the table. 

The only question you should be asking yourself now is, are you ready to discover your company’s hidden savings?  After all, in the words of another late-night infomercial, “It’s your money”.

By: Dan Schmidt, Founder of EBCFO and Ben Anderson, Manager at CBIZ MHM, LLC Kansas City

February 26, 2016

Josh Finfrock, Director in the CBIZ MHM Memphis office, recently spoke at the U.S. Intermediate Transfer Pricing Update Bloomberg BNA conference on February 22nd & 23rd.

The two-day conference included instruction on common transfer pricing methodologies and concepts for accountants, attorneys, and other tax practitioners.  The program was designed as a training session to introduce tax practitioners to the key reporting and compliance issues in establishing an arm’s length price under Sec. 482 and the OECD guidelines.

Finfrock leads the Transfer Pricing practice at CBIZ and performs work for companies all across the world.  At the conference, Josh presented 'Analyzing the Intercompany Transfers of Tangible Property.'  In this session, he discussed… available methodologies, types of manufacturers, types of distributors, and examples of common intercompany transactions as it all relates to sales of tangible property.

Transfer pricing in the United States continues to be a topic of major concern to tax executives at U.S. outbound and inbound multinationals. Transfer pricing requires financial statement results to properly reflect profits between business units for tax and earnings forecasts. As a result, corporate tax and financial executives must establish effective internal controls and defend their pricing policies before their auditors and the IRS.

For questions regarding transfer pricing and its impact on your international operations, please contact Josh Finfrock at jfinfrock@cbiz.com or 901.685.5575.

February 25, 2016
CBIZ MHM Memphis hosted an Employee Benefit Plan seminar last week called Retirement Plan New Year’s Resolution: Is Your Plan Ready for 2016?  This session covered understanding of fiduciary duties and responsibilities, financial planning for 2016, and the DOL’s audit quality study.

With a room full of plan sponsors and administrators eager to start their 2016 planning right, Jennifer Kiesewetter, ERISA, ACA, & Executive Compensation Attorney at Kiesewetter Law Firm, began discussing the various fiduciary duties and responsibilities that are overlooked or unknown.  Furthermore, Jenny educated attendees on consequences of breach of fiduciary duty as well as ways to limit fiduciary liability.

Jeff Barnes, Senior Consultant at Gavion, LLC, shared with the group how to determine goals and best practices for Plans in 2016.  He also covered various plan considerations and proposed many questions sponsors and administrators should be answering during their planning processes.

In closing, Linda Lauer, Lead Managing Director for the Memphis Office, reviewed key findings and conclusions that were found in the recent DOL Audit Quality Study.  The statistics in the study confirmed that the more plans audited by a firm, the less deficiencies performed.  Linda concluded the presentation with the DOL enforcement, regulatory, and outreach recommendations.

To attend one of our future seminars, join our mailing list by clicking here.  For questions regarding the study and/or the impact on your company’s benefit plans, please contact Linda Lauer at llauer@cbiz.com or 901-685-5575.

February 24, 2016

CBIZ MHM Tampa Bay is proud to be a presenting sponsor of the Tampa Bay Business Journal’s CFO of the Year event. The 2016 CFO finalists were invited to a VIP reception at the offices of Shumaker this month to recognize their accomplishment for being selected as an outstanding financial professional in the Tampa Bay area.

The awards luncheon revealed the results of this year’s CFO of the Year winners.  More than 400 people gathered to recognize these financial professionals for their exceptional performance in their roles as corporate financial stewards.

Winners in each category were chosen from an independent panel of judges.  The winners in their respective categories are as follows:

Rob Taylor, CFO of Accuform Manufacturing Inc., was the 2016 overall CFO of the Year winner for his service within the financial sector.

CBIZ MHM Tampa Bay is proud to sponsor an event that honors such influential leaders in their various financial fields and wishes to extend a warm congratulations to all individuals selected to be part of the Class of 2016 CFO of the Year Finalists. 

To see a full list of the 2016 finalists, click here.


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