The constant hum Coloradans have heard recently is the sound of moving trucks making their way from California to Colorado. It seems like there’s a headline every day about companies either moving headquarters or greatly expanding their footprint in the Centennial State.
But for businesses following the lead of Slack, Vizio, Palantir and the many others establishing roots in Colorado, there are some significant accounting and finance implications to keep in mind. Fortunately, a handful of simple tips can minimize disruptions and ensure a move to Colorado is nothing but cause for celebration.
1. Establish a game plan early
A corporate relocation involves a lot more than just the move itself. In fact, packing everything and physically moving it to a new location is often the simplest part of the process. From an accounting and finance perspective, a relocation could potentially mean having to find a new auditor, bankers, recruiters and other specialists essential to operations.
However, finding such new partners doesn’t happen overnight. Therefore, a company should start planning its move as early as possible, especially if it involves hiring a critical new partner like an auditor. A CFO doesn’t want to leave themselves in a position where, on top of physically moving locations, they’re also scrambling to find a new audit firm with deadlines fast approaching.
2. Gauge the impact of a relocation on your people
When Molson Coors relocated its corporate finance, HR and other central functions from their downtown Denver office to Chicago and Milwaukee in 2019, only 10% of employees actually made the move, many opting for new jobs rather than voluntarily relocating. Similarly, when Schwab opened its Lone Tree campus in 2014, the firm left its entire C-suite back in its San Francisco offices.
Both examples represent the impact a relocation can have on operations, just from opposite ends of the spectrum. Whether from turnover or sheer distance, a relocation can leave accounting and finance teams susceptible to skill and knowledge gaps that can negatively impact everything from financial reporting and compliance to relationships with vendors and employee morale.
As part of a general relocation strategy, companies should be proactive in gauging the effect of a move on their workforce. For a CFO, staff augmentation will be critical to fill any knowledge gaps in technical accounting, financial reporting or other essential areas, particularly if there are open leadership seats. Continuity will play a significant role in determining if a corporate relocation is smooth and successful or becomes nothing but a series of escalating issues.
3. Keep an eye on processes and the control environment
As a consequence of the previous point, a relocation can also wreak havoc on a company’s processes and financial controls, especially when key employees leave. With essential skill sets or even control owners now missing from the roster, it doesn’t take long for a relocation to become a massive headache for accounting, finance and internal audit teams.
As a proactive measure, companies can use an upcoming relocation as an opportunity to review...
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