Editor's page.

• Author: Marshall, Jeffrey

Innovation is a key engine of growth, but it frequently sputters if the financial fuel is too lean or the "newness" of the products is oversold and they are really glorified line extensions. In our cover story, two consultants from Archstone Consulting argue that CFOs have as much responsibility for the success or failure of innovation as any senior executives.

Moreover, they maintain that "the fact-based discipline required to resource and manage innovation over complex organizations ... is precisely what effective finance executives excel at and should be relied upon to bring to the innovation process."

Expectations are high in some quarters that Auditing Standard No. 5 (AS5) will do much to trim what are perceived as excessive audit charges related to Sarbanes-Oxley Section 404 compliance. But no one is really sure, and the experience may be different for very large companies than for the non-accelerated filers that have yet to file reports, notes writer Stephen Barlas.

The CFO's relationship with the board--and particularly the audit committee--has changed significantly with the advent of Sarbanes-Oxley, but just what should it be? Executive Editor Ellen M. Heffes interviewed a number of board experts, and one dominant theme is communication: the finance chief needs to spend more time and effort keeping the audit committee and other board members up to date on financial issues. Other characteristics topping a "wish list" of CFO skills include integrity, honesty, knowledge of the business and industry--and guts.

Restructuring is an experience many CFOs and other senior finance executives will experience first-hand. Robert Tormey of Tatum LLC offers a series of suggestions and procedures that the CFO should think about when a restructuring looms or is actually underway. As he writes, creditors tend to remember executives who were helpful in a crisis, and many CFOs have found a restructuring to be a real asset on a resume.

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