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MANUFACTURING & WHOLESALE DISTRIBUTION INDUSTRY NEWS
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| September/October 2017 |
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Insights from Inside the Huddle: SRC Lexington & the Great Game of Business
In this day and age when the construction labor force seems tighter than ever before, employers must find ways to set themselves apart from their competitors in order to attract and retain top talent. In July, Harding Shymanski & Company co-hosted a seminar featuring SRC of Lexington, Inc. In order to create a winning culture, the company adopted the Great Game of Business strategy developed by Jack Stack. During the event, General Manager Rob Shear and four employee-owners shared their insights on what it takes to build a Great Game culture to help their company thrive.
In addition to sharing personal insights and lessons learned, Shear shared that they focus on the principles of the Great Game:
- Know and teach the rules: Educate employees about the business to help them think like an owner.
- Follow the action and keep score: Empower employees to make better decisions and act like an owner.
- Provide a stake in the outcome: Engage employees by providing them with a stake in the outcome so that they feel like an owner.
- All three elements focus on the Critical Number that the organization defines together to establish what "winning" means for the organization.
Participants at the event particularly appreciated that the SRC Lexington team shared "practical applications" as to how they have implemented the concepts. Among the practices that are working well for them are:
- Strong employee committees that are run by people outside of the management team.
- Temporary committees that address issues of a limited scope.
- A financial education system that is run by employees from the Ownership Culture Committee.
- Rewards and recognition programs.
- High-involvement planning across the organization.
When asked why he was willing to share the "secret to their success" with so many others and potential competitors, Shear suggested that while this type of culture change is not for every organization, he is passionate about the positive environment and financial impact the culture shift has created for SRC Lexington.
To learn more about the Great Game of Business, SRC Lexington, Inc., or to explore whether an employee stock ownership model is right for your organization, contact Paul Esche CPA, CCIFP, CCA at [email protected] or 800-880-7800 ext. 1335.
To receive a digital copy of the book The Great Game of Business please contact John Rittichier, CPA at [email protected] or by calling 800-880-7800 ext 8484.
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Risk Management- Recently Issued Shadow Brokers Information
A hacking group known as the Shadow Brokers has released a significant amount of data and exploitation tools on the internet. Multiple versions of Microsoft Windows along with several other platforms and databases have been affected. Software vendors are in the process of releasing patches and updates to counter this hack. Companies' systems will remain vulnerable until the patches are installed.
To understand the leaked information and determine if your system is vulnerable click here for the full article or contact Brant Kennedy, CPA at 800.880.7800 ext. 1425, [email protected].
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Work Opportunity Tax Credit
Manufacturers who experience high employee-turnover rates or use temporary employment agencies for entry-level positions may qualify for the Work Opportunity Tax Credit (WOTC). WOTC can provide valuable tax savings to companies who hire employees that fall into one or more targeted groups, such as veterans or individuals with significant barriers to employment.
If you employ any individuals that could fit into one of these target groups or utilize a temporary employment agency for staffing needs, click here to read more about the Work Opportunity Tax Credit or contact John Rittichier, CPA at 800.880.7800 ext. 8484, [email protected].
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Summary of Illinois Income Tax and Sales Tax Changes from P.A. 100-0022
Illinois recently enacted Senate Bill 9, or Public Act 100-0022 (P.A. 100-0022) to amend the Illinois Income Tax Act and the Retailers' Occupation Tax Act. Informational Bulletin FY 2017-01 helps interpret the consequences and effective dates of P.A. 100-0022 for Illinois taxpayers and practitioners.
Some highlights of the changes:
- Effective July 1, 2017, income tax rate jumps from 3.75% to 4.95 % for individuals, trusts and estates.
- Effective July 1, 2017, corporation (excluding S corps) income tax rate increases from 5.25% to 7%.
- The standard exemption allowance is not available for married filing joint taxpayers with an AGI of $500K or higher and $250K or higher for all other filers for tax years starting January 1, 2017.
- Federal Domestic Production Activities Deduction must be added back to Illinois AGI or taxable income for tax years ending on or after December 31, 2017
- Illinois research and development credit has been reinstated until December 31, 2021 and is retroactive for the 2016 tax year.
- Effective July 1, 2017, the manufacturing exemption is expanded to include graphic arts machinery and equipment.
For details on the above and other changes, see Informational Bulletin FY 2017-01 here or contact Aaron Wilzbacher, CPA at 800.880.7800 ext. 1322, [email protected].
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Case Study: Revenue Recognition Over Time for Products
The new revenue recognition standards are coming. Have you assessed whether your company's revenues will be recognized over time or at a point in time under these new standards? The case study linked below provides a comprehensive example that illustrates the recognition of revenue over time and the criteria that may require you to do so. As the over time recognition method is considerably different from current practice, understanding the method's recognition criteria and application is important.
To review the case study, click here or contact Brant Kennedy, CPA at 800.880.7800 ext. 1425, [email protected].
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ABOUT OUR MANUFACTURING & WHOLESALE DISTRIBUTION INDUSTRY TEAM
From increased competition and continuous quality improvement demands to rising employee benefit costs and declining margins, manufacturers and wholesale distributors are facing greater challenges than ever before. In addition to the services you would expect from an accounting firm, we have a dedicated team ready to assist you with the unique challenges and issues facing your industry.
A number of our staff members belong to The Association for Operations Management (APICS) with some having achieved the CPIM and CIRM certifications. We understand your key issues and possess the drive and determination to help you manage your company on a proactive basis. This commitment positions us at the cutting edge of the industry and enables us to spot trends and deal quickly with the issues your company may be facing. |
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SEE WHAT OUR CLIENTS ARE SAYING...
"We engaged with HSC in 2007 as we began repositioning our market focus. Since then, our business has increased tenfold. We have expanded into 15 different states and now operate from six locations. HSC's counsel on tax, accounting and finance has proven to be timely and insightful playing a vital role in helping us achieve these results. Harding Shymanski will be a valued partner for the long term."
- Bruce & Katrina Stallings, Owners, P&I Supply
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Disclaimer: The information contained in this email is for general guidance on matters of interest only. The publication does not, and is not intended to provide legal, tax or accounting advice.
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Harding, Shymanski & Company, P.S.C.
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