Worcester Business Journal

wbjournal.com | December 9, 2024 | Worcester Business Journal 23 By Amy Finch Amy Finch is the compliance and operations support manager for White- Water, the water utility management subsidiary of Auburn-based construction firm R.H. White. This is the second part in a two-part advice series on businesses' relationship to water. Part one appeared in the Nov. 25 edition. 5) Customers want to know more about where their water comes from. When looking for information regarding your water supply, start with your water supplier, the best resource for accurate information. 4) Public water supplies are highly regulated. A PWS is a system that provides water for human consumption to at least 25 people daily for 60 days or more out of the year or to at least 15 service connections. Mass. regulations are often stricter than federal rules. The Massachusetts Department of Environmental Protection ensures all public water supplies, from the smallest restaurants to our largest cities, adhere to strict regulations protecting public health. Public water is tested routinely. 3) Technological advances are improving the operation of water supplies. More advanced alarm controls, level sensors, and automation of specific processes allow water operators to perform their work more effectively while reducing hazards. Computer programs can be used to capture data and create compliance reports that were once handwritten. Electronic data submission allows water operators, regulators, and consumers easy access to the water quality in their PWS. 2) With technology comes the threat of cybersecurity breaches. The newest buzzword in the water works industry is cybersecurity. The U.S. Environmental Protection Agency is offering free cybersecurity assessments to all PWSs, and the White House has declared October Cybersecurity Awareness Month. MassDEP considers cybersecurity to be part of the emergency response plan for all PWSs. 1) Water works professionals are in high demand. Water and wastewater operators are essential jobs that impact many people's lives. The pool of operators is aging, and a challenge has been to bring younger, qualified, and licensed persons into the industry. In addition to operations positions, there are numerous other career opportunities, including maintenance technicians, administrative positions, and management roles. What business owners need to know about new federal financial filing requirements M ergers and acquisitions can be a mixed bag of emotions and strategies depending on which side you are on. For the acquir- ing business, it is expansion, growth, and the next step forward. For the business being acquired, it could mean apprehension and fear of job security. Ultimately, through strategizing using thorough vetting, engaging middle management, and integrating company cultures, the two companies can find cohesion and become better together. Strategizing using thorough vetting. A merger and acquisition should not be a sporadic action, but a strate- gic move that a company has spent time, sometimes years, maneuver- ing. According to J.P. Morgan's Q&A with Landscape Forms CEO Margie Simmons, businesses should carefully assess the size, brand, and culture of the prospective company they want to acquire. If a company is too big, it will take more resources to obtain, and if it is too small, the cost might not be worth the benefit. Additionally, assess- ing brand impact on the market and learning about the company culture assists in a smooth transition. Engaging middle management. Acquisitions can cause trepidation in employees who are afraid they may lose their jobs. As a result, they look to their current managers for reassurance. Because of this, Susan Ladika, writing for the Society for Human Resource Management, suggests incorporating middle management as part of the transition strategy and allowing them to provide confidence they are directly interfacing with employees. Ladika explains while there may only be a handful of C-suite executives, there are oen hundreds of middle managers who can be key in keeping workers mo- tivated so a successful acquisition can take place. According to a 2019 study by e Conference Board, companies who actively engaged middle manage- ment were more successful in mergers than those who did not. Integrating company cultures. Synergy is a word that is oen used in the mergers and acquisitions space because it underlines how important it is for two companies to find common- ality for the merger to be successful. Integrating cultures can oen be the make-or-break obstacle for mergers. To overcome this hurdle, Kison Patel, writing in the M&A Science Newslet- ter on LinkedIn, suggests performing a cultural audit evaluating how similar and different the companies are in terms of performance and goals. Pro- viding training helps employees adapt to the new, combined culture of the new entity. MANAGING YOUR COMPANY THROUGH A MERGER OR ACQUISITION BY DAVID MCLAREN Special to WBJ T here are major changes as well as new laws that now affect business owners that they never had in the past. How they will affect you and the penalties associated with them may be surprising. In an effort to reduce tax fraud and other financial crimes, Congress passed the Corporate Transparency Act in 2021. is created a new reporting requirement as part of efforts to make it harder for bad actors to hide their ill-gotten gains. All entities that file documents with their secretary of state's office, including newly formed corpo- rations, LLCs, limited partnerships, and other entities, will need to file with the U.S. Treasury Department's Financial Crimes Enforcement Network. e report will require disclosing the owners of the entity or the beneficial owners of the entity. ese rules apply to entities that existed before 2024, with a Jan. 1. due date for filing. While this is part of the federal government's attempt to look beyond shell companies set up to hide money, it unfortunately imposes burdensome requirements on most businesses. Willful failure to report information and timely update any changed infor- mation can result in significant fines of up to $500 per day until the violation is remedied. If criminal charges are brought for not filing, larger fines and even possible imprisonment await. ese penalties can be imposed against the beneficial owner, the entity, and/or the person completing the report. A beneficial owner includes owners who directly or indirectly own at least 25% or who exercises substantial control over operations. is includes non-own- ers that control the company and may just be employees, for example. is will include senior officers, board members, or others involved in significant deci- sions. Considering the fines, it is safer to file and include yourself. If an entity is formed in 2024 or later, the applicant must be disclosed, including the person who registered the company and controls company filings. All people included in the broad definition of beneficial owners will need to have their name, address, date of birth, and other personal information disclosed for the BOI filing. You also have to upload a copy of identifying documentation, like a driver's license. Most entities must file these reports by Jan. 1. However, entities formed in 2024 or aer will have only 30 days from the entity's formation or registration to file. ere is a proposal to extend this to 90 days for entities formed in 2024 only. Should any reported information change or a beneficial ownership interest be sold or transferred, the entity must re- port this within 30 days or risk penalties. ose changes may include a beneficial owner's change of address or even pro- viding an updated copy of identification. Having a business owner remember to refile any of these changes on-time seems like a large risk. Falling out of compliance is very easy. We recommend having a business attorney do the filing for you. 5 Things I know about … ... Water industry trends David McLaren is the founder and managing partner of McLaren & Associates CPAs in Shrewsbury. W W W KNOW HOW

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