Topics to Discuss at Your Next Board Meeting

Rising interest rates and erratic market fluctuations have created concerns about the possibility of a recession in the months ahead. Businesses struggle to attract and retain quality staff at every level. Cybersecurity concerns and digital transformation continue to rank highly on senior management and the director’s minds. In the face of these challenges, organizations need to examine their preparedness and take advantage of opportunities for greater efficiency.

Weaver, knowledgeable in advisory services, offers several topics to incorporate into your next board meeting to generate productive discussion and illuminate prospective opportunities as well as challenges. The following five questions can serve as a guide for your next board meeting, helping to secure your organization’s future from the possible risk the future holds.

1. How can the board assist management during uncertain financial times?

With financial oversight as a primary responsibility, the board must ensure that the organization’s assets are used efficiently. As inflation and interest rates rise and economic conditions begin to meet headwinds, the board can assist management in securing the organization’s financial position effectively and making sure financial internal controls are in place to protect the assets of the organization.

To support management, ask these questions:

• Ask questions to understand changes in liabilities. For example, are we dragging out payment of our obligations?
• Monitor days outstanding in AR to identify whether cash collections are slowing.
• Have there been changes in pricing strategy or payment terms with customers?
• How have customers reacted to increasing prices, which are a result of increasing cost of goods, labor and production?

2. How are we attracting and retaining the best staff?

Fluctuations in the labor market have affected organizations of all types and sizes, altering the available talent pool inside and outside of your organization. A new approach to develop the competencies and leadership you need today and into the future, like assessing your existing workforce development and planning processes against a maturity model, can help organizations manage through the current disruption and beyond. Evaluating defined criteria against a maturity model provides a roadmap to move an organization toward aspirational goals: assessing the current state of workforce planning and working together to identify the needed actions to meet strategic goals and objectives.

Asking the following questions can help an organization develop a more strategic approach to succession planning; one that accounts for current needs, mitigates potential weaknesses, and supports long term ambitions.

• How does our organization find talent?
• Have we had success with recent hires? Are we hiring the right people?
• Who are our key people that we need to retain at each level?
• How are we retaining our best people? Why do our most reliable and loyal employees stay?
• Are we developing and supporting emerging leaders?

3. Have we assessed our company’s readiness for a cybersecurity incident?

Ransomware attacks, Denial-of-Service attacks and data breaches are so disruptive, they are more than IT problems — when your company gets attacked, you need to know the plan. How do CEOs, CFOs, COOs and other leaders support the IT team to help, and not hurt, as you get through the first 48 hours together?

Weaver has developed an incident response checklist to help leaders — especially those outside the IT department — assess their company’s readiness for a cyber-incident. It includes a sharable “In Case of Emergency” quick reference page to list key contacts, the location of the Incident Response Plan and other information leaders will need to access quickly.

Leaders can use this questionnaire to confirm their plan covers the most important aspects of a cybersecurity incident response, such as:

• Who is in charge of the response, and what authority do those people have?
• Do we have a cyber insurance policy? Who is responsible for informing the carrier of an event, and when?
• Who will document events, the system state, response actions, and maintain evidence with proper chain of custody?
• Who will manage internal and external communications? Is regulatory reporting required?

4. How challenging is the close process in our organization?

Timely and accurate reporting of financials is critical to the success of an organization, but the process can be challenging. There are a multitude of actions that must occur across the accounting team to prepare draft financials for review and evaluation by management and directors. Small hiccups in the process can have a ripple effect through the entire cycle. Whether or not your organization has confronted issues with the timeliness and accuracy of financial reporting, ask these questions:

• Does the board, specifically the Audit Committee, understand the timelines and challenges encountered by the business each month and quarter to close the books and prepare financials?
• What are the challenging and/or time consuming issues that management must work through each period end? How is management addressing these issues?
• Are financial results prepared timely for management use, not just external financial reporting?

5. Does our organization appropriately leverage technology to maximize processes and internal controls?

Technology continues to create positive change in how routine, daily processes can be performed. Organizations of every size must enhance their effectiveness by leveraging technology solutions through digital transformation. The changes to business technology, culture, and processes can also disrupt the culture of the business and create ripple effects throughout the company.

As you consider your organization’s internal controls and the technology surrounding them, ask these questions:

• Are we using technology to manage internal controls and ensure they are current, properly assigned and executed each period?
• Are internal control processes designed to work with an ERP rather than forcing a manual process around the system?
• Are we leveraging the availability workflow functionality to maximize efficiency in the process and allowing the system to enforce the process flow and compliance with internal control expectations?
• Is access properly provisioned to allow for enhanced reliance on system processes and configurations?

Weaver offers information and insights to prepare for your next board meeting. We can help you ask the right questions and determine appropriate plans of action based on topics and trends as they unfold. Subscribe to our monthly insights for articles and information to help you review your organization’s operations and prepare for change in an uncertain world.

© 2022