SCAFP News July 2003

From the Corner Office

As I pen my first "From The Corner Office", I am reflecting upon two thoughts.  First, the incredible honor you have bestowed upon me to serve as SCAFP's President for the coming year; and second, the tremendous opportunity and challenge we have to build upon the organization's successes and positive momentum of this past year.

My theme for SCAFP this year is "everyone recruits . . . everyone serves".  It is this principle that will guide my first two priorities as President.  First, we must increase the number of practitioner ("corporate") members in SCAFP.  Only a large, growing, and vibrant corporate member base will ensure that we continue to attract quality luncheon and symposium speakers as well as the generous financial support of our many bank & vendor members and sponsors.  While this effort will be lead by the Membership Committee, we will only succeed in growing our membership if everyone recruits.

My second priority is to increase the number of members who volunteer to serve SCAFP on its various committees and projects.  The long-term health of our organization is dependent upon having everyone contribute.  Every member has gifts and talents to share with SCAFP.  What are yours? When called upon to serve, I encourage you to answer with an enthusiastic "yes".  For those of you who have taken the initiative to ask, "how can I help", let me respond by saying "thank you".

It is my privilege to introduce the SCAFP leadership team for the coming year.  Serving with me will be:  Morgyn Taylor (Freemont General) as President Elect, Chuck Hays (Hays Consulting) as Secretary & Treasurer, Chuck Beckert (Bank of the West), as Major Events Committee Chair, Jenny Young (Sony Pictures Entertainment) as Meeting Programs Committee Chair, Tiffany Lemieux (Fidelity Investments) as Membership Committee Chair; Susan Bredbenner (SunGard Treasury Systems) as Education Committee Chair; Chuck Whitney (Union Bank of California) as Immediate Past President; Richard Bort (Bort & Company) as a Director at-Large; and Jessica Fox (Union Bank of California) as a Director at-Large.

There is a lot of exciting SCAFP events coming this year.  From our annual "You Bet Your Cash" game show on December 12th to the 2004 EXPO LA Symposium on May 12th & 13th to the stimulating monthly luncheon speakers to the new educational programs that you will learn more about in the coming months.  I encourage you to take full advantage of all that SCAFP has to offer and I look forward to seeing you at the August 8th luncheon meeting.

Have a wonderful summer!

Michael Hards
President

 New Member Drive

SCAFP soon will introduce a New Member campaign in an effort to increase our overall membership. The goal of this campaign will be to increase SCAFP's membership by a minimum of 10 percent.  This will be the first membership campaign in SCAFP's history and all members are encouraged to participate! After all, increasing our membership pool will benefit each of us.

My plan for this campaign is as follows:  For every new recruit that you successfully encourage to join, you will receive a bounty of $50 dollars and recognition at the following luncheon meeting.  This will be an on-going campaign; however, the SCAFP member who encourages the most new members to join by May 2004, will be awarded a grand prize at our June 2004 luncheon.

The success of this campaign requires the participation of each existing member!  We will be announcing all the details very shortly, so stay tuned!

Tiffany Lemieux
 SCAFP Membership Chair

 AFP Announces Major Change in Its Certified Cash
 Manager Program

The AFP has announced the creation of the new Certified Treasury Professional credential, or "CTP." Any current Certified Cash Manager (CCM) may elect to become a CTP or to remain a CCM. Upon choosing to convert to a CTP credential, AFP will provide support with a new CTP pin and a badge ribbons for attendees at the AFP's annual conference.

Those who elect to become CTPs will be required to be recertified in three-year cycles, like the current CCM program. CCM renewal credits and CTP renewal credits will be identical and interchangeable.

The CCM exam given in June was renamed the "CTP Exam," and those who passed will receive the CTP credential. For more information about the conversion, please see the AFP's Web site at www.afponline.org.

SCAFP members who elect to convert from CCM to CTP should notify the SCAFP office so that we can change our records. Call (818) 843-5660 or e-mail the office at scafp@emaoffice.com.

 EXPO LA Symposium 2003 Success

Our annual conference, held May 14th and 15th at The Omni Los Angeles Hotel, was a tremendous success!  The symposium met the primary SCAFP objective of offering a high quality education program to our members and the financial community at large. A speaker from one of our sponsoring organizations said that EXPO LA’s program was the best regional educational program he’s ever attended. This is a credit to those SCAFP members who worked diligently to plan this conference, especially the program committee.  The number of attendees this year surpassed last year's attendance.  CCM's, and the newly designated CTP's, could earn up to 10 CCM or CTP credits at this years conference.

We want to thank Christi Ritter, EXPO LA Program Chair, and her committee for doing such a wonderful job of bringing good speakers to EXPO LA. We thank our SCAFP members for their participation, and for recommending EXPO LA to others within their company and other colleagues.  Another thank you goes to Bill Luehrmann, Sponsorship Chair and his committee for all their hard work in garnering sponsors.  We had more sponsors this year than in past years and we thank them for their support and appreciate their participation.  What would a successful EXPO LA be without a Marketing Chair?  Dick Bort handled this role with great success and was responsible for generating interest with the highly successful Bingo Game.  By visiting vendors, all attendees had an opportunity to enter a drawing for valuable door prizes.  Stickers were obtained from each sponsor and when the Bingo Card was completely filled in, attendees dropped their Bingo Card in a basket awaiting the results of the drawing.  Sponsors appreciated the tabletop traffic created by the Bingo Game.  That gave them the opportunity to visit with all EXPO LA attendees. 

Congratulations to the two winners of the Bingo Game:

Sane Martin of American Honda Motors - Winner of a portable DVD player valued at $400.00.

Fernando Rivera of Citibank (West) FSB - Winner of a crisp $100.00 bill.

In addition to successes highlighted above, EXPO LA Symposium 2003 was a financial success to the SCAFP treasury. 
 

 SAVE THE DATE for EXPO LA Symposium 2004 scheduled
 for May 12 and 13 at The Omni Los Angeles Hotel.

The new EXPO LA committee has been formed and is looking for volunteers to support SCAFP by getting involved.  Please let any SCAFP officer know of your interest.

Jessica Fox
2003 EXPO LA Symposium Chair

 Larry Newell Retires

Larry Newell is the co-founder - together with his daughter, Janine Newell - of SCAFP's association management company, Executive Management Associates. Larry announced his retirement from the firm at SCAFP's June 13th Board meeting, saying "It’s time to play some golf." Larry has been a very stable influence for the officers and Board over the years, and we will miss his sound advice and wise counsel.

 Postscript to Shootout at the Wall Street Corral

Gary Wollin luncheon keynote speaker at EXPO L.A. Symposium 2003, on the topic of "Shootout At the Wall Street Corral," sent us a postscript. He says, “Knowing what to buy and when to buy it is important, but perhaps even more important is to have a 'sell strategy.'" Here is Wollin's time-tested sell strategy.

"Many years ago, when I was the Director of Investments Research, I did a computer study of the stock market and found that if a stock declined 12 1/2 % from it's high, 85% of the time a new downtrend had started.

So, one of the best and simplest ways to limit your losses is to multiply your purchase price or any subsequent higher price by 87 1/2% or .875. Any time the price of the stock drops below that figure... sell.

For example: if you bought a stock at $20, your sell point on the way down would be $17 1/2 (20 X .875 =17.5). If the stock went straight up to $35 after you had purchased it, you would have a sell point of $30 5/8 (35 X .875 = 30.625).

Cut your losses short, using the "DOWN AND OUT" formula.  You will probably save much more money by being out of sharply declining stocks than you will forgo by missing a major upward move in a stock after you have sold it. And, you will still have most of your funds available for the next opportunity.

By the same token, there is no rule that states that you have to sell a stock just because you have a profit.”

So we put a question to Wollin:

SCAFP: Would you recommend putting a "stop loss" order on each stock in the portfolio, and adjusting the limit price each time the stock reaches a new high?

Wollin: Not necessarily. Some core portfolio holdings, like the bluest of the blue chips, are held for the VERRRRRY long term. They might never be sold. You know them – the household names. Sometimes, though, even the best of companies go down a LOT, like AT&T in recent years.

My sell strategy works best with cyclical and trading stocks. In these cases I would have a mental stop.

Please remember, selling any stock can create taxable consequences, which must be taken into account, especially if the stocks were held for a very long time. Think - cost basis.

SCAFP members who missed Gary Wollin’s presentation, or who want to review it again, are invited to Wollin's website where he has his whole set of "hot tips" in the form of a report. Go to: http://www.garywollin.com/report.html.

Legislative Update (Reprinted from www.afponline.org)
Overview
Momentum on Check Truncation legislation (Check 21) is growing.  The House passed a bill the week of June 2, and the Senate Banking Committee approved its version on June 18..

Industrial Loan Companies
The House Financial Services Committee recently passed two bills that would expand the power of industrial loan companies (ILCs). These companies, which currently operate in California, Colorado, Minnesota, Nevada and Utah, have traditionally specialized in one service, such as offering credit cards.

Check 21
On June 5, 2003, The House Financial Services Committee passed the "Check Clearing for the 21st Century Act," or "Check 21" by a vote of 405-0.  The Senate Banking Committee passed its version of Check 21 on June 18, 2003.

Taxation of Internet Sales
The House Subcommittee on Commercial and Administrative Law passed H.R. 49 in late May. The full House Judiciary Committee is likely to mark up the bill by the end of June.

Derivatives Regulation
Senator Feinstein (D-CA) offered an amendment to the Senate energy legislation. The amendment would have undone parts of the Commodity Futures Modernization Act of 2000, and placed unnecessary regulation on OTC derivatives. That amendment failed by a vote of 55 to 45. Prior to the vote, AFP signed onto a coalition letter opposing this amendment.

Rating Agency Regulation
The Securities and Exchange Commission (SEC) on June 6, 2003, issued its long-awaited Concept Release "Rating Agencies and the Use of Credit Ratings under the Federal Securities Law." In a January report to Congress, which was required by the Sarbanes-Oxley Act, the SEC stated its intent to deliver the Concept Release by the end of March.

Expansion of Fedwire Hours
The Federal Reserve Board announced that it will expand the hours of the online Fedwire service effective in the second quarter of 2004. Fedwire will open at 9:00 p.m. Eastern Time (ET) the prior calendar day, three and one-half hours earlier than the current opening time of 12:30 a.m. ET.

Regulation CC Availability Schedules
Faster check availability will be a by-product of a decision by the Federal Reserve Banks to reduce the number of locations at which they process checks. The reductions are a cost-cutting measure because of the decline in check volume. 

Qualifying Special-Purpose Entities
The Financial Accounting Standards Board (FASB) released an exposure draft that will tighten the requirements for qualifying special-purpose entity (QSPE) status. Under the proposal, banks (which generally sponsor QSPEs) may be required to record the assets, liabilities, revenues and expenses of many QSPEs in their financial statements.

Cross-border Euro Transaction Fees
Effective July 1, 2003, banks in the euro zone must offer cross-border electronic payment transactions in euros at the same price as the equivalent domestic euro payments. This ruling had been approved by the European Union (EU) Parliament in December 2001 because of the high cost of euro transactions.

Corporate Check Conversion to ACH Debits
NACHA has not yet taken action on a rule change permitting corporate check conversion to automated clearinghouse (ACH) debits. In a letter to NACHA, AFP had reported that most members oppose having their checks converted to ACH debits.

Use of Social Security Numbers
NACHA is requesting comments on whether NACHA rules should be amended to specifically address the use of a consumer's social security number (SSN) as part of an ACH transaction. NACHA rules are silent on the issue

SCAFP Links

 Monthly Meetings
  Job Opportunities
 Educational Programs
 Membership Info
 Links
 

Meetings Coming Up: 

August 8 – Bill Fairbanks, Marsh McLennan, “Risk Management”

September – No meeting

October 10 – Richard Richardson, Phoenix-Hecht (tentatively scheduled), “Bank Pricing”

Job Opportunities

Check out the latest job opportunites or post a job opening at www.scafp.net/JobOpps2.htm

New Members

Mark Mathers of San Bernardino County in San Bernardino (Practitioner)

Steve Sain of Wells in Los Angeles (Non-Practitioner)

Wendy Sieruga of San Bernardino County in San Bernardino (Practitioner)

Karol Tremain of Teledyne Technologies in Los Angeles (Practitioner)

Reminder to Members – No Solicitation

SCAFP has had a “no exceptions” policy since its founding 28 years ago that the roster of SCAFP members is not to be made available to anyone other than members, and that members are not to use the roster to solicit business from fellow members. A recent violation of that policy brought to the Board’s attention that the policy needs to be reiterated more often, and a legend to that effect will be printed on the front of the printed roster in the future.

Copyright 2003, Southern California Association for Financial Professionals

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