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As a business owner there are many reasons why you may need to know how much your business is worth. Perhaps you're considering selling, or maybe the valuation is required by the IRS or a court of law. Gilmore Jasion Mahler (GJM) Partner Jeff Denning specializes in business valuation and explains the process in this short video.

Learn more about Jeff's expertise in business valuation and forensics, and don't forget to sign up for GJM's free quarterly newsletter The Expert. It offers timely and helpful articles with a focus on business valuation and litigation support. Just click here for quick and easy sign up.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive services including assurance, business advisory, tax, risk advisory and healthcare management. The Firm's professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

On January 3, 2020, Iranian General Qasem Soleimani died in a Reaper drone attack carried out by American military forces. The American government cited a growing threat against US national security and the interests of the US as predication for the strike. There have been reports that Iranian cyberattacks against American businesses and government agencies are sure to intensify in retaliation.

While this may seem like an issue for the United States government to handle, American companies should recognize the fact that Iranian cyberterrorists and their allies are likely to target US civilian companies in an effort to destabilize as much of the country as possible.

The Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA) has issued several warnings to American companies to explain the breadth and depth of the looming threat of cyberterrorism. It is essential for all US companies across all industries to take appropriate measures to defend their interests and digital assets, especially those pertaining to sensitive private data of US citizens.

Defending Your Business Interests and Data from Iranian Cyberterrorism

Ultimately, it’s important for all American business leaders to know that it is virtually impossible for the average company to protect itself from an all-out cyberattack staged by Iranian agents and Iranian allies.

The best a potentially vulnerable company can do is to make the company as hard of a target as possible in the hopes that any attacks against it will appear to be more trouble than they’re worth. It’s also essential to have protections in place in the event your company needs to recover after a cyberattack from Iranian operatives or any other cyberattack.

The CISA recommends American companies take the following steps to minimize their chances of becoming targets and to streamline recovery processes after successful attacks:

• Enable port monitoring and disable all nonessential ports. Companies should know which ports are necessary for business-critical operations and which are vulnerable. For the ports that must remain open, enable port monitoring to track all traffic through those ports.
• Configure advanced email and communications monitoring. Companies should carefully track phishing trends and consider implementing phishing protection measures to prevent employees from inadvertently granted access to cyberterrorists.
• Patch all externally facing equipment immediately. “Day zero” vulnerabilities exist on all types of equipment, so you don’t want to run the risk of letting several patch cycles pass while your systems remain unprotected.
• Limit and restrict PowerShell usage. Log all use of PowerShell within your company and cut off access for any employees who do not require access for day-to-day job duties.
   
• Configure a reliable data backup system. A good rule of thumb is to have at least three copies of your critical data in at least two different locations, one of which should be offsite.
• Conduct response and recovery simulations. It’s a good idea to put your defensive measure to the test and run simulations to see how your team responds to an active threat simulation, including data backup and other recovery processes.

If Iranian agents decide to attack American businesses digitally, experts predict it will be done with the intent of causing chaos and disruption rather than to extort. Businesses that take appropriate precautions will be harder targets and will therefore be more likely to be overlooked by Iranian cyberterrorists.

If you are unsure about your organization’s data security environment, contact Gilmore Jasion Mahler, LTD (GJM) to learn how we can help you defend your interests and protect your data against cyberattacks. GJM’s experts can help to uncover the vulnerabilities of your business and assist with data governance.   

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

On September 30, 2018, the United States-Mexico-Canada Agreement (USMCA) was established after 13 months of negotiations. While the agreement is not currently ratified, the USMCA intends to replace the North American Free Trade Agreement (NAFTA), which has been in place since 1994. Ratification is expected to take place in early 2019.

The USMCA brings several changes to the economic relationship between the three North American countries. These include greater market access, inter-governmental cooperation mechanisms, and higher duty-free limits.

Everyone will feel these changes, not just major government agencies. Three provisions in the USMCA will particularly impact small businesses:

1. The establishment of the Committee on Small and Medium Enterprise (SME) Issues
2. The increase of the de minimis threshold
3. Changes to the automobile industry

The Committee on SME Issues

Chapter 25 of the USMCA will establish a Committee on SME Issues. This committee will assemble within one year of ratification and will be comprised of government officials from the U.S., Canada, and Mexico.

The committee will assist SMEs in their transition to the USMCA, identifying strategies to boost their economic success and increase cooperation between markets. The committee will host an annual SME Dialogue, inviting experts, academics, employers, non-governmental organizations (NGOs), and other stakeholders to engage in conversation on SME issues.

Small business owners may benefit from the representation this committee will provide. However, this committee will only be comprised of government officials. Not implementing the committee effectively may cause the voices of small business owners to drown within a messy bureaucratic system.

The Increase of the De Minimis Threshold

The de minimis threshold refers to the quantity of product you can purchase online and import duty-free. The USMCA raises the de minimis threshold to $800 USD for United States products, $150 CAD for Canadian products, and $100 USD for Mexican products.

This increase can lead to significant benefits for small businesses, which often do not have the resources to pay customs duties and fees. This will increase sales volume, providing greater profits for small business owners.

The 75% Tariff-Free Threshold for Automobile Manufacturers

Under the USMCA, 75% of an automobile must be manufactured within North America to be exempt from tariffs. This is a significant increase from the 62.5% requirement under NAFTA.

This provides an incentive for automakers to decrease operations overseas. The new threshold holds the potential to provide more income for small, local auto parts manufacturers and to increase jobs for North American workers.

If you're interested in staying up on issues impacting the manufacturing world, consider signing up for Gilmore Jasion Mahler's free quarterly e-newsletter The Manufacturer. It addresses a broad range of financial topics impacting the world of manufacturing. Just click here for quick and easy sign up.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.  

There's been a lot of upheaval and uncertainty in global markets recently, and, for the United States, part of that is the new imposition—by both America and China—of tariffs. Beyond any financial arguments about whether or not trade wars are good and easy to win, there's no doubt whatsoever that trade wars, specifically in the form of tariffs, will change the market. And though it may take a while for these effects to be felt by the public, the impact of tariffs will be felt first and most deeply by manufacturing.

Big Industries Get Hit

Tariffs can have a huge impact on manufacturing and many other American businesses in unexpected—but understandable—ways. The U.S. has recently gone after the industrial sector with tariffs specifically targeting steel and aluminum.

Any steel or aluminum coming into the U.S. from specified nations now has an additional percentage cost added to the existing price. In other words, tariff impact on manufacturing means foreign steel and aluminum providers now have to pay an additional 25% and 10%, respectively, before they can cross the border into the U.S. and be used by American businesses.

Of course, steel and aluminum are pretty commonly used materials in a wide variety of industries, businesses, and applications. So, that extra cost will affect more than just the materials industries that are importing them into the country.

Tariffs Generate a Widespread Ripple Effect

As steel and aluminum import taxes increase, many businesses feel a ripple effect. Not only do tariffs impact the manufacturers of these metals affected, but also a manufacturer’s clients who turn steel and aluminum into consumable products.

For example, cookware and plumbing manufacturers will pay premiums for the materials needed to produce their goods. Further down the line, bakeries, restaurants, hardware stores, plumbers, and many other tradespeople will see increases in the cost of steel-based and aluminum-based products that are necessary to their professions. In turn, those bakers and plumbers must now decide whether to absorb the loss or raise the prices of goods and services to their customers in order to offset the price increase on metals.

Every link in the chain is affected by tariffs: the first-level producers, manufacturers, small and mid-sized businesses reliant on those products, and finally the everyday consumer.

What to Do About Tariffs

Governments know that tariffs are going to have a huge impact on the economy of the other countries involved a trade war. That’s why they are effective means of negotiating market conditions. However, many businesses and consumers get caught in the middle. So what can a small or mid-sized business do as tariffs are on slapped on the products they need?

While it may not be the solution for every manufacturer, one effective way to mitigate tariffs on manufacturing is to source materials from unaffected nations. Steel and aluminum, for example, are receiving tariffs from many nations, but Australia and Argentina are exempt. Sourcing metals from these countries means business can go on as usual.

For businesses using metal-based products, it may be best to arrange your affairs before tariffs begin to affect you. For example, if you need new tech equipment, with aluminum and steel parts, purchase that equipment soon or second-hand. You can also make more strategic business moves when scaling up. Say you're looking to expand your restaurant business to new cities, consider purchasing a space that's already outfitted with most or all of the features you'll need, so you can reduce the costs associated with acquiring new, and often imported, materials.

If you'd like to know more about tariff impact on manufacturers or which tariffs may affect you, reach out to your GJM team. Let us guide you through a complex, ever-shifting market and global trade climate.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting services and provides comprehensive services including assurance, business advisory, tax, risk advisory and healthcare management. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.

Dr. Jeremy Cripps brought some welcome news to area manufacturers at a recent Gilmore Jasion Mahler (GJM) Manufacturing & Distribution Financial Executive Roundtable event. That news: he sees no sign of recession now or in the next few years. Economists have been keeping close watch as there had been speculation toward the end of 2019 of a potential recession late in 2019 or perhaps in 2020.

Cripps, an accounting professor at University of Findlay, and avid economy watcher, was the featured speaker at GJM’s roundtable events in both Maumee & Findlay on January 23^rd. He says there are three key factors to consider when looking at the possibility of recession: job growth, consumer confidence and business confidence. He told attendees at both roundtable events that in his opinion none of those indicators suggests recession. He says non-farm job growth is steady, consumer confidence is healthy and he sees no big dip in business confidence.

While easing concerns about recession are welcome, any successful business owner knows they must always be on alert to a potential downturn in the economy and many other potential threats. Gilmore Jasion Mahler CPAs Bob Bobek and Wes Beham say threat of recession or not, there is plenty you can do right now to ensure the health of your business headed into 2020.

“First and foremost,” says GJM Assurance Partner Wes Beham, “Do what you can to improve your balance sheet. Look at your discretionary spending: What can you cut out? For example, dues and subscriptions, travel expenses and other costly commitments can really add up.”

Wes’ other recommendations include the following steps:

• Improve receivable collection efforts with timely and efficient invoicing
• Tightly control investments in new equipment
• Pay down debt

GJM’s Bob Bobek, like Wes, also spends a great deal of time advising clients how to protect their businesses from potential threats. Bobek says regardless of the state of the economy, you should never ignore business growth strategy.

“You need to fight for your market share,” says Bobek. “You need to be prepared for aggressive pricing. And don’t rely on your current customers for more sales. Remember, they’re watching their bottom line as well. Protect those customer relationships but add new customers too. I always say, ‘a business that isn’t growing is shrinking.’”

Bobek and Beham offered attendees other important strategies to safeguard their businesses headed into 2020. They include:

• Reduce raw material and finished good inventory levels
• Evaluate your supply chain
• Evaluate staffing flexibility
• Invest in new technologies with immediate returns
• Reduce Costs
• Engage your banker, continue to manage and grow this relationship
• Develop an acquisition strategy
• Save cash

Gilmore Jasion Mahler offers the Manufacturing & Distribution Financial Executive Roundtable events three times a year at both Maumee and Findlay locations. The gathering is designed for area manufacturing financial executives to come together and share best practices and hear from guest speakers on timely issues that impact their businesses. The next scheduled GJM Manufacturing & Distribution Financial Executive Roundtable event is April 23 and the topic will focus on logistics challenges. Any manufacturing financial executive who would like to attend or sign up to receive future roundtable invitations can email info@gjmltd.com. 

Wes Beham is a partner in the firm’s assurance and consulting area and has over 15 years of experience with Gilmore Jasion Mahler. In his time with the firm, Wes has provided audit advisory and services to a broad range of companies. He leads the firm’s Manufacturing Specialist Team and is a key member of the Construction & Real Estate Specialist Team. Wes has also worked extensively on mergers and acquisitions, and with publicly traded companies as a Sarbanes Oxley auditor and an Internal Auditor for those companies.

Bob Bobek is an assurance partner with over 35 years of public accounting experience who specializes in advising high growth entrepreneurial companies. Bob speaks to groups on topics including; developing key financial ratios and using them to manage your business, understanding and developing contract price estimates, internal control and fraud risks, developing an accounting system for a small organization, treasury management and the fiduciary responsibility of a board.   

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.