Latest news with #Armanino
Forbes
6 days ago
- Business
- Forbes
Changes Coming: How The OBBBA Affects State Tax
In this episode of Tax Notes Talk, Steve Kralik of Armanino discusses the One Big Beautiful Bill Act's implications for state tax, including the new version of the SALT cap and how states may conform to the changes. Tax Notes Talk is a podcast produced by Tax Notes. This transcript has been edited for clarity. David D. Stewart: Welcome to the podcast. I'm David Stewart, editor in chief of Tax Notes Today International. This week: getting SALTy. As we previously covered, there were a few sticking points in the process of getting the One Big Beautiful Bill Act passed into law. One of those points was what to do with the state and local tax, or SALT, deduction cap, which was set to expire at the end of 2025 with other Tax Cuts and Jobs Act provisions. The House SALT Caucus originally pushed for the cap to be increased from $10,000 to $40,000. But Senate Republicans were concerned with the overall cost of the bill, advocating for keeping the cap at $10,000 and using it as a pay-for to offset other tax cuts. So where did Congress end up on the SALT cap, and what do other tax changes in the bill mean for states? This episode is part of our ongoing series on the One Big Beautiful Bill Act. As we continue to dive deep into the most important tax changes and provisions in the coming weeks or even months, we'd like to hear from you. If there's an aspect of the bill that you'd like to hear more about, please email us at podcast@ But for now, here to talk more about this is Tax Notes senior reporter, Paul Jones. Paul, welcome back to the podcast. Paul Jones: Thanks, Dave. It's always a pleasure. David D. Stewart: I understand you recently spoke with someone about this. Who did you talk to? Paul Jones: I spoke with Steve Kralik, who's managing director of Armanino Advisory LLC. David D. Stewart: And what did you talk about? Paul Jones: Well, as we'll hear, Steve is quite knowledgeable about the debate over the OBBBA, including the back and forth over the SALT cap element. So we discussed that, and we also talked about how the increase and extension of the SALT cap will impact states' own passthrough entity workarounds, which allow PTE owners to sidestep the cap. We also talked about some of the ways that the bill's provisions could impact states' own tax policies, including their conformity decisions. And we also got into what might be coming next in terms of some federal tax policy legislation, or at least debates over it. David D. Stewart: All right, let's go to that interview. Paul Jones: Hi, Steve. How are you doing today? Steve Kralik: I'm great. Thanks for having me, Paul. Paul Jones: Yeah. So just a couple weeks back, the One Big Beautiful Bill Act was passed into law and signed by President Trump, and obviously there are a lot of implications for states. One of the things we talked about previously that I'd like to sort of recap is the SALT cap debate that occurred during the discussion of H.R.1. And there were a couple efforts to address particularly states' SALT cap workarounds for passthrough entities. Can you talk quickly about what lawmakers in Congress were initially proposing to do to change or to hem those in and ultimately what happened, why those didn't get passed? Steve Kralik: Well, yeah. So the origin of the SALT cap workarounds go back a number of years ago. Shortly after the Tax Cuts and Jobs Act was passed, there was an effort — and it started, actually, in my home state of Connecticut — to provide a continued uncapped deduction for passthrough entity owners. So the idea being to provide a deduction at a passthrough entity level that gets taken off of gross income to arrive at a net amount distributed to the passthrough entity members. And so Connecticut was the first in a long line of states adopting this type of provision. Connecticut, their tax was actually mandatory, but the other states adopted elective taxes. And ultimately, the IRS in 2020, so in the Notice 2020-75, blessed the idea of allowing taxes paid at the entity level to avoid the cap at the individual level. And there was a lot of questions up until that notice was issued about whether these workarounds would be valid and would be held valid by the IRS. The IRS eliminated a lot of that uncertainty in 2020. Over 35 states have these passthrough entity taxes. And so the big question mark in this legislative session was whether or not the cap would continue. So the $10,000 original cap under the Tax Cuts and Jobs Act, there was a huge question mark because the legislation was passed with that cap going away. So instead of going from $10,000 to some other number, it would be uncapped after 2025. And so the question mark was, does the federal government expand the cap, continue to hold the $10,000 cap, or continue with the uncapped amount? And so that was the big tension here, was the extending of the cap was politically unfavorable. But also, an uncapped SALT deduction would be very costly. So there was a huge amount of political turmoil around continuing with the SALT cap. And so the initial bill passed by the House of Representatives had an expansion of the cap, but what happened was there was a limitation on this SALT workaround — the SALT cap workaround, the passthrough entity taxes, or PTET as we call them. Paul Jones: Right. And was that an effort to save money, so they were increasing the cap, but they were going to try and curb some of these workarounds to compensate for that cost, or was there a different motive for that? Steve Kralik: Well, it was definitely revenue related, but there also was a bit of politics going on in that the original cap was designed to affect high tax states that typically lean Democratic. And so as this was a Republican-led bill, there was some thought that some of these limitations were designed more from a political perspective. But as you mentioned, the expansion of the cap — because going from $10,000 up, it costs a lot of money. And so the idea was to recapture some of that loss through limitations on the passthrough entity tax. And so the proposal, it had winners and losers for passthrough entities. So there's a special deduction that's available. It's section 199A of the Internal Revenue Code that applies to passthrough entities and businesses that earn money other than through professional type services. So doctors, lawyers, and accountants, for example, are not eligible. And so the House bill actually had a limitation that would have disallowed the PTET for those types of businesses. And so there was a lot of pushback on the House bill as it went over to the Senate. So there was a lot of lobbying for a change to that limitation. So the limit would've been unlimited for businesses eligible for 199A, other than professional services, but would've limited it for the professional services. And there wasn't really a policy justification. Again, it was I think just a budgetary consideration. And so as it went to the Senate, the Senate proposal wound up scrapping that proposal and then adopting something different — an expansion for passthrough entity tax from $10,000 up, but ultimately with a 50 percent limitation. So above the flat dollar cap, all businesses — not doctors, lawyers, and accountants versus other businesses — it scrapped that and would've provided a 50 percent limitation in passthrough entity tax. And so there was concerns now — everybody previously eligible and taking advantage were concerned about losing access to this benefit. And so then, ultimately, the final legislation expanded the cap but retained the prior deductibility of the passthrough entity tax. Paul Jones: Right. So now moving forward, obviously, like you said, we have a larger SALT cap overall. And the passthrough entities that were taking advantage of the states' workaround still have basically an unfettered ability to do that, at least per the federal government. But now that it looks like some version of the cap is going to be here to stay. It's $40,000 for now, and then it will go back down to $10,000 unless they extend that. It also looks like states' workarounds are probably going to be permanent. There are some states that have to maybe talk about extending theirs. I think most of them just have them go on or terminate when the federal cap ends. Their workarounds will continue going forward. But there are some other issues. I know that I've spoken with people who've said that the rules that various states apply for purposes of their passthrough entity tax workarounds have proven complicated or maybe a deterrent for taxpayers who want to utilize a way of getting around the SALT cap. And obviously there may be less taxpayers now who feel the need to use the SALT cap because the cap is higher. But for those who still want to utilize it, are those rules — do they continue to pose a burden, and is there going to be more pressure on states maybe now to take a look at the workarounds they've approved and try and make them more streamlined or user-friendly? Steve Kralik: Thanks for bringing that up. As a state tax specialist, I'm used to complexity in state tax. It's not just 50 jurisdictions, it's a whole lot more. And wading through statutory language and procedures, it's second nature for me. But even I, encountering the passthrough entity provisions, I'm often perplexed, I would say, as part of the look into the various states' approaches to passthrough entity tax. And so the percentage of total passthrough entities that take advantage — I was relatively shocked at the low percentages who actually takes advantage out of all potential passthrough entities. And I think the complexity and procedures between prepayment requirements that are outside the ordinary course of a typical compliance process and who's eligible, what's the base, for example, do resident taxpayers bring in 100 percent or not? Those are things that differ state by state, or sometimes, it's even hard to tell what the rules are, to be honest. And so now that there's a perpetual — the anticipation was that the need, and in fact in some cases, the actual passthrough entity tax would've gone away with the SALT cap no longer being capped. There was not as much of an impetus. If something is temporary, it's much less likely that you're going to try to fix anything that's problematic. What I would hope is that the states in some way — and there's different ways of approaching this — there are different groups that can push these types of changes through. But some way to harmonize or streamline some of these rules would definitely be welcome and perhaps provide additional pickup where the states may be better off. And definitely taxpayers and tax practitioners as well would have more certainty, more clarity around these rules. And so if one thing comes out of this is the idea that we could do it better. We could change the way that these calculations are done and explain them in a way and harmonize them state to state. I think that would be very welcome and then would definitely affect how many people ultimately elect into these regimes. Paul Jones: So let's move on now and take a quick look. Some of the concern people have had about the One Big Beautiful Bill Act's impact on states' bottom lines has to do with changes to funding, for example, to Medicaid and, I think, SNAP [Supplemental Nutrition Assistance Program]. But also obviously there's a whole bunch of changes to the federal tax code, and some of those will flow through to state tax codes. And that will depend on how they conform, when they conform, if they choose to update their conformity, etc. But just quickly, what are some of the changes at the federal level that you think states may need to make conscious decisions about? You obviously have the permanently increased bonus depreciation, immediate R&D [research and development]expensing — there's even a higher standard deduction. They increased that a bit, and some above-the-line tax breaks such as for tips, which as we previously discussed, that could actually pose a bit of a political challenge. Steve Kralik: The conformity to federal tax provisions is something that varies by state, but there's a few different types of conformity. So, for example, for the bonus depreciation, this isn't the first time that we've adopted some form of bonus depreciation, going back to, I believe, shortly after 2001, I believe was the initial bonus. And so states have generally decoupled from the bonus depreciation. The conformity to federal tax code, the Internal Revenue Code, there are some states that adopt all changes based upon what's called rolling conformity. So basically the current Internal Revenue Code as it exists today. I suspect that, and have not done full research here, but the states with rolling conformity that had previously decoupled from prior versions of bonus depreciation likely would decouple currently. There may be states, though, that have specific language referring to a particular type of bonus depreciation which would need to affirmatively decouple, otherwise the federal deduction would come through on the state return. Other states have what's called static conformity, where it's a conformity to a prior version of the Internal Revenue Code. And so, again, using depreciation, the bonus depreciation, it wouldn't be a part of that particular state's provisions because they would've coupled with, for example, the Internal Revenue Code as of December 31, 2024 , for example, and so would not adopt automatically these provisions. As you mentioned, the interesting, I think, political question is going to be states that have automatic — called rolling conformity — to, for example, for personal income tax, gross income, section 61. The way that the tax on tips and tax on overtime was adopted is through what's called an above-the-line deduction. It's a deduction to arrive at your gross income or your taxable income. So if the state conforms to taxable income or gross income and has rolling conformity, they will automatically conform to this exemption. And now states may not want to, given budgetary concerns, and given obviously the change in the SNAP and Medicaid, which there's a lot of revenue that goes through to the states, which now, that revenue is going to be lessened. So you're going to have a budgetary impact at the state level along with a reduction in potential receipts. But the political aspects of pushing through a special tax on tips and overtime is maybe something like a third rail. That may be something that taxpayers may be quite upset about if they realize that the state's going to take special effort to tax them. And the last thing I mentioned is there is a change in the expensing of R&D. Actually, many tax prognosticators had expected that to go away a lot earlier than 2025. There's been a huge push since the provision was adopted in the Tax Cuts and Jobs Act, but that finally was changed. One thing that's interesting from a state and local perspective is the potential for the differential in treatment. So previously there was a five-year capitalization and five-year amortization for U.S.-based research and a 15-year amortization for foreign research. That's been changed to allow U.S.-based research to be fully expensed immediately. What is interesting from a state and local perspective is the potential that that disparate treatment for U.S. versus foreign research might actually be violative of the foreign commerce clause. And given that it's gone from instead of a five [years] versus 15 [years], it's a full expensing with the ability to file amended returns to claim, the potential exists that that potential constitutional challenge might be out there. Paul Jones: So actually on the topic of changes that could potentially spur litigation, I want to move on to a different topic, and that's the changes that have occurred with GILTI [global intangible low-taxed income], or as it's now called the NCTI [net controlled foreign corporation tested income]. And the One Big Beautiful Bill Act changed the way that that income is taxed. And basically, as I understand it, they significantly broadened the base. And the way that that is taxed at the federal level still provides a fair amount of relief. But states that have been taxing GILTI, which do not bring in foreign tax credits, they're potentially going to be substantially increasing their taxation of that. I bring this up in part because there's potential down the road that that could actually lead to litigation. But before we get to that question, do you think that there's going to be a greater push in light of, as you mentioned, some of the budget reality states are facing for more states to try and tax what was GILTI income, now it's NCTI income, under these new rules? Or maybe we're going to see sort of the same hesitancy by other states to go after this income? Steve Kralik: I think it's a big question mark right now. I do think that the expansion of the new NCTI — so net CFC tested income, NCTI — it's an expanded definition of taxable income, removing what was called the deemed tangible return. That's been removed, and in exchange for that removal, as you mentioned, an expansion of the foreign tax credit. Now states do not conform to the foreign tax credit, and so the expansion in the small number of states that do tax GILTI would definitely have an increase. You've asked another question, which is states, given that there's been a change to expand the definition of taxable income under the new NCTI, would there be an impetus for them to expand the taxation of the income? Let's say, for example, they previously provided 100 percent exemption or deduction for that, or 95 percent, for example, in a few states. I think there might be, and it might be because there's a change. But also on the flip side, in states that do tax, for example, and don't provide what's called apportionment relief, there might be an additional amount of impetus to challenge some of the states that do tax GILTI, now NCTI. Paul Jones: So basically you had a situation, and I think this is similar to what you were talking about with the immediate R&D expensing, where there had been some possibility of a legal conflict or litigation and that the changes made by the One Big Beautiful Bill Act, H.R.1, have maybe exaggerated or intensified these in such a way that there's going to potentially spur litigation that we were maybe anticipating but never actually saw under the TCJA or previous federal tax policy. Now we might actually see legal battles about this come to fruition. Is that correct? Steve Kralik: That is correct. Again, with the expansion of the tax base and the change in the calculation, I think it does provide a potential avenue for future litigation, which, as you mentioned, didn't really come to fruition under the original Tax Cuts and Jobs Act and the original foreign income provisions. Paul Jones: So I'm sort of curious then. I had been thinking about this from the context of updating conformity and everything like that, but obviously the litigation angle here raises this question in my mind in a different way. Overall, when we had the Tax Cuts and Jobs Act passed, it took a number of years. And of course we also had the pandemic throw a wrench in things and complicate things. But it took a while for states to figure out which elements they were going to adopt, how they were going to adjust, etc. Do you have any sense — do you want to speculate as to whether the OBBBA is going to be more disruptive or less disruptive in terms of states having to adjust to it, possibly litigation resulting from some of its provisions adopted at the state level, for example, than the Tax Cuts and Jobs Act was? Steve Kralik: I believe at the corporate income tax level and the changes from GILTI to NCTI, I think that that is going to be a little bit quieter because I think that they've laid the groundwork for the approaches that they're going to take. So I think it's going to be at the margins. I think at the personal income tax [level], I do believe that the changes to taxes on tips and taxes on overtime are going to be something that's going to be in the news a lot, I think. I think that that taxing, following the federal rules, and whether or not the states are going to decouple, is going to be something I think is going to be a little bit more of a political question as we move forward. Paul Jones: So we've got H.R.1, we've got the One Big Beautiful Bill Act signed into law. But of course, I believe the Speaker of the House, Mike Johnson, has made it clear he's now moving forward with some follow-up tax policy legislation. And there were obviously some provisions, we discussed a couple, that were proposed and never actually made it into the final OBBBA. For example, there was talk at least at one point of broadening protections under Public Law 86-272 to provide more protection for businesses that carry out solicitation of sales and various other potential activities over the internet. I'm curious if you have any thoughts as to what we might be looking at coming down the pike. Are there likely to be any other major tax policy changes at the federal level in any of this follow-up legislation, do you think? Or do you think that the stuff that was significant from a state tax policy standpoint probably made it through in H.R.1? Are we in the quiet before the storm of another round of debate, or have we maybe got the major changes that we're going to see this year? Steve Kralik: I believe that the state and local tax big changes likely were either included or excluded, and I don't think that they're going to revisit those in this next bill. Now, you did mention the impact of the proposal, which was ultimately stricken, to expand the protections of the federal legislation. It's called Public Law 86-272. I do think that that stands a good chance of being revisited in this second bill. But just to backtrack a little bit and explain what it means to state and local tax: So P.L. 86-272, it's a federal law which limits a state's ability to impose a net income tax if a company is only soliciting sales of tangible personal property and sends those orders outside the state for acceptance or rejection and ships from outside the state. What has happened in recent years was the MTC [Multistate Tax Commission] had proposed an expansion of the disqualifying activities, an interpretation of Public Law 86-272, to extend it to internet-related activities. For example, having a job application on a website or having a post-sale activity with the ability to chat with a customer service representative through the internet. That those activities — because they're not entirely ancillary to solicitation, not directly related, only related to the solicitation because there was a separate business reason to conduct those activities — that those activities were disqualifying. Even though they were conducted at a server from outside the state, it'd be deemed to be conducted within the state. And a number of states that have taken up the MTC's proposed model rules, one of them being California. California adopted those rules in a TAM [techincal advice memorandum] in 2022 that was ultimately shot down for procedural reasons but may represent the FTB's [Franchise Tax Board] interpretation of the extent of Public Law 86-272. The federal legislation, the proposal that was in the House of Representatives' proposed bill, would have limited that effort by deeming any activity that's related to solicitation, even if it's not entirely ancillary, it'd still be protected. And so that proposal may still come back in this next bill, and that could have some big impacts, state and local perspective. It basically would provide continuing protection in updating Public Law 86-272 for the 21st century. Paul Jones: Right. So with H.R.1, we sort of had a giant collection of tax policy decisions that had to be made. And now that that's passed, there's more of an opportunity maybe to drill down on some of these specific issues like these proposed changes to 86-272. I think you mentioned it's come up in previous years. Maybe it's time to really get that square focus on it, on the merits, and for lawmakers to decide if they're going to go forward with it or not. Steve Kralik: I agree. And the fact that it was in the original bill, I think provides some additional consideration that may come back again. Paul Jones: Got it. Well, this has been a fascinating conversation, Steve. Just want to say thanks for taking time to share your thoughts with us and all of our listeners. Steve Kralik: Thank you so much. It's really been a pleasure talking about this. And I do want to share that it's been an exciting time in state and local tax, seeing things in the news. Pretty exciting for a practitioner who's done this for a long time. So thanks again. Again, I appreciate the opportunity.
Yahoo
26-07-2025
- Business
- Yahoo
The IPO market may be back, but only for prepared CFOs
This story was originally published on To receive daily news and insights, subscribe to our free daily newsletter. After three sluggish years in the IPO market, the rising cost of capital paired with recent stock market performance has resulted in a resurgence of IPOs. But for finance chiefs hoping to join that wave, the path forward likely isn't about perfect timing. Rather, it's about precision and performance. 'This is all about, do you have great numbers? If you have the metrics… the market is open,' said Dean Quiambao, chief relationship builder, partner and Northern California Market leader at accounting, consulting and technology firm Armanino, and a trusted adviser to pre-IPO CFOs. After predicting the IPO market would have the upturn it's seeing now, Quiambao still says metrics alone aren't enough. 'A Taylor Swift-style 'Love Story' is not good enough anymore,' he said. 'These companies better have a growth story.' Turning metrics into action According to Quiambao, headline metrics are only the start to a successful offering. He affirmed investors want proof of revenue quality, customer retention and legitimate product or offering expansion capabilities. 'To use Sigma Computing as an example, [more than half] of customers use two or more products,' he noted. 'That feels good.' He also cited Sigma's Rule of 40 score, saying it's at 63, as the kind of performance that catches institutional investor attention. '[I believe] that one's gonna go,' he said. 'Watch out.' Once metrics like these are achieved, Quiambao said it's the CFO's job to not only present them, but to strategically embed them across the organization. 'The best companies control the KPIs that matter most to them,' he said. 'They go to market saying, 'These are the 10 or 11 [KPIs] we track. Take a look [at] how we track them quarter after quarter.'' Quiambao said the most effective CFOs can turn those KPIs into shared accountability. 'They've built a sense of responsibility across the company,' he said. 'People feel like that's our metric. Those team members know how they can personally take ownership of the data.' With this in mind, there's an important distinction to be made that confidence in current performance is less important than the ability to forecast. 'I've personally met CFOs and finance teams who've told me, 'The only thing stopping us from going public is our forecastability of [quarter over quarter] revenue and sales,'' he said. 'They say, 'We know the deal is going to come in, but we just don't know what quarter it's going to come in.'' That kind of variability in forecasting, he explained, can disqualify otherwise strong companies. 'If you're going to go public right now, you better hit your first couple of quarters,' he said. 'That's imperative.' Balancing growth aspirations with IPO pricing While investors want growth, they also expect to see scalable operations and profit leverage. Quiambao said the ability to show how automation improves margins is now also a must. He explained how Chime, the mobile banking fintech that had its IPO early last month, is a good example of this. 'Chime has become known for implementing technology to the point where a large majority of their customer interactions don't [involve] people,' he said. 'They build systems, processes and technology, and that's driving down cost and increasing efficiency.' But even when the fundamentals, forecasting and execution are all there, pricing the IPO appropriately remains critical. 'Don't be greedy,' Quiambao said. 'There have been companies recently that went out a little greedy, and they were just flat.' He cited CoreWeave's recent IPO as a case study in smart valuation. 'They went out at a decreased valuation than what was reported in the past, and then they had some results, and then they had some quarter by quarter. And now? Look at them. They're on a solid trajectory.' Quoting a conversation he had with a leader at NASDAQ Capital Markets in New York, Quiambao said pricing strategy is critical to earning investor dollars on the onset. '[The NASDAQ leader] said, 'I got $20 trillion within eight blocks up here, and they all want to buy tech,'' Quiambao explained. 'But he made an important distinction: they've got to go out at the right price.' For some companies, that means going public at a reduced valuation. 'Are you willing to go out at a price that might be less than your last stated valuation, and then go earn it back?' Quiambao said. 'Well-prepared finance teams will earn that valuation back if they do it right.' Private equity's influence For the growing number of CFOs who are working at private equity-backed companies, preparing to go public comes with added layers of complexity. Quiambao said those deals often require navigating capital structures that weren't designed with public markets in mind. 'Private equity wants to move fast, but the CFO needs to be sure that the process is done correctly. A flat IPO is never good, but one under private equity or after a private equity exit can result in additional challenges for leadership across the organization.' Dean Quiambao Partner, Northern California market leader, Armanino 'You've got time constraints, carry structures, rollover equity, maybe some debt limitations,' he said. 'And sometimes the CFO's job becomes, how do we untangle all that and still tell a clean, compelling story to public investors?' In these scenarios, finance leaders are balancing the expectations of their PE sponsors with the type of rigor demanded by public markets. That includes aligning short-term performance with long-term investor confidence, while also making sure legacy deal structures don't create any extra friction between leaders during the IPO process. Quiambao said successful PE-backed CFOs tend to treat readiness as a full-time discipline, not a transactional push. 'They're modeling out scenarios early, managing tax exposure and thinking about how to structure equity in a way that holds up under public scrutiny,' he said. 'And they're doing it all on a compressed timeline.' He said a flat IPO in this scenario can be detrimental. 'Private equity wants to move fast, but the CFO needs to be sure that the process is done correctly. A flat IPO is never good, but one under private equity or after a private equity exit can result in additional challenges for leadership across the organization.' A Bay Area bounce back? While other cities have drawn headlines for innovation and tech talent, Quiambao said the Bay Area is quietly regaining its position as a hub for AI and IPO-stage companies. Other areas, like Texas and Miami, have claimed their cities as the next technology and finance hubs too, but Quiambao says San Francisco's role in that is growing rapidly right now. 'People might not want to believe it, but the Bay Area is coming back,' he said. 'We are becoming the home of AI.' He described a new concentration of venture firms, founders and startups around the Mission Bay neighborhood, where OpenAI's headquarters sit across from the Golden State Warriors' arena. 'There are always important people walking around, there's always security everywhere,' he said. 'It's like the AI corner right there. You want to meet an AI person? Just hang out there for a bit. The buzz around here is real.' He also said he sees founders reversing course on the trend of a mass exodus of business, finance and technology professionals from California that has occurred in recent years. 'I met a CEO during New York Tech Week, and he told me he is moving from New York to San Francisco,' Quiambao said. 'His competitor is here. His VCs are here. The AI scene is here. He said, 'I have to move where the action is happening.'' Recommended Reading The IPO market is ready for a comeback, says Armanino's Dean Quiambao Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
16-07-2025
- Business
- Business Wire
Armanino Expands Managed Service Offerings with Addition of Strategic Accounting Outsourced Solutions (SAOS)
SAN RAMON, Calif.--(BUSINESS WIRE)-- Armanino, one of the 20 largest independent accounting and business consulting firms in the U.S., is proud to announce the addition of the team from Strategic Accounting Outsourced Solutions ('SAOS'), a specialized outsourced accounting firm. This combination strengthens Armanino's position as a leader in delivering tech-driven outsourced finance and accounting solutions. Recognized on the Inc 5000 fastest-growing firms list for three consecutive years, SAOS brings a focused approach to outsourced accounting, combining deep expertise, a strong technology foundation, and a transparent, relationship-first model. Beyond its rapid growth, SAOS is known for its commitment to long-term client success, operational excellence, and forward-thinking strategy tailored to each client's current and future needs. 'SAOS is a values-driven team with a passion for strategic client support in outsourced accounting and advice,' said Matt Armanino, CEO of Armanino Advisory LLC. 'Their people, specialized expertise, and strong service culture align perfectly with ours, and together we'll deliver even greater impact for our clients. The need for outsourced services, especially in complex areas of finance, payroll, human resources, tax, fund administration and nonprofit strategic development outsourcing, is only growing, and this combination allows us to expand our outsourced finance offerings and scale faster to meet this major need.' SAOS enhances Armanino's outsourced capabilities with additional depth specifically in the nonprofit and family office sectors, core client bases for SAOS and Armanino. In addition, SAOS and its clients will benefit from the full breadth of Armanino's services including specific solutions such as reporting automation and deeper consulting support. Armanino's focus on innovation and AI will also serve as a cross benefit, allowing SAOS to leverage additional platforms that enhance reporting capabilities for clients and robotic processing automation tools to deliver efficiency, clarity, and actionable insights. 'For us, this was all about alignment of values, culture, and long-term vision,' said Kim Discenza founder and CEO of SAOS. 'Armanino has always stood out for its client-centric philosophy and forward-thinking mindset, which sets them apart from other large accounting and consulting firms. But what truly matters is that their culture reflects our own: one that prioritizes people, fosters a strong sense of belonging, and empowers employees as the foundation of long-term success. We share a commitment to integrity, innovation, and delivering exceptional value to our clients. This partnership represents an exciting step forward for our employees and clients, and we're proud to be joining forces with people who see the future the way we do.' 'Armanino and SAOS recognize the future of the profession is in high-touch turnkey solutions like outsourced accounting that are responsive to what clients need in today's business environment,' said Allan Koltin, CEO at Koltin Consulting Group, who advised both firms on the combination. 'Both firms share a commitment to growth grounded in client success and creating solutions designed to solve mission critical challenges, making for a strong cultural alignment and an easy decision to come together.' Clients of SAOS will continue to enjoy the trusted relationships and personalized service they have come to expect, now enhanced by Armanino's expansive resources, multidisciplinary expertise, and national scale. 'Armanino offers the infrastructure we were seeking to scale and enhance the great work we're doing for clients,' said Brittany Russell, partner at SAOS. 'Paired with strong cultural alignment, this partnership will enable us to accelerate our vision of becoming industry leaders in serving family office and nonprofit clients.' This move is part of Armanino's broader strategy to identify high-performing teams across the country and integrate specialized talent into its practice. To learn more about Armanino click here. About Armanino 'Armanino' is the brand name under which Armanino LLP, Armanino CPA LLP, and Armanino Advisory LLC, independently owned entities, provide professional services in an alternative practice structure in accordance with law, regulations, and professional standards. Armanino LLP and Armanino CPA LLP are licensed independent CPA firms that provide attest services, and Armanino Advisory LLC and its subsidiary entities provide tax, advisory, and business consulting services. Armanino Advisory LLC and its subsidiary entities are not licensed CPA firms.
Business Wire
25-06-2025
- Business
- Business Wire
Armanino Foods Reports Quarterly Dividend and Announces Shareholder Meeting Date
PLEASANTON, Calif.--(BUSINESS WIRE)-- Armanino Foods of Distinction, Inc. (OTCQX: AMNF) today announced that its Board of Directors has declared a quarterly cash dividend of $0.04 per share on its common stock. The dividend will be payable on or about July 27, 2025 to shareholders of record on July 7, 2025. This is the Company's 100 th consecutive quarterly dividend. The Company has also paid out eleven special dividends. Additionally, the Company announced that it will hold an Annual Meeting of Shareholders on September 24, 2025, at 9:00 a.m. Pacific Time. The Annual Meeting will take place near the Company's headquarters in Pleasanton, CA. Full details regarding the Annual Meeting will be included in the Company's proxy materials, set to be delivered to shareholders in August 2025. Armanino Foods of Distinction, Inc. is an international food company that manufactures and markets frozen Italian specialty food items to the foodservice, retail, and industrial markets. In addition to a classic Basil Pesto, Armanino offers other flavors and sauces including Cilantro, Dried Tomato & Garlic, Roasted Red Bell Pepper, Southwest Chipotle, Artichoke, Roasted Garlic, Light Basil Pesto, Chimichurri, Harissa, Bolognese, and Alfredo. Armanino's organic line includes classic Basil Pesto. Finally, Armanino Foods also offers cheese shakers, frozen pastas, and meatballs. Cautionary Statements Regarding Forward-Looking Information Statements in this news release regarding our expectations and beliefs about our future financial performance and trends in our markets are 'forward-looking statements' as defined in the Private Securities Litigations Reform Act of 1995. Forward-looking statements often include the words 'believe,' 'expect,' 'anticipate,' 'intend,' 'plan,' 'estimate,' 'project,' or words of similar meaning, or future or conditional verbs such as 'will,' 'would,' 'should,' 'could,' or 'may.' The forward-looking statements in this news release regarding our future financial performance are based on current information and because our business is subject to several risks and uncertainties, actual operating results in the future may differ significantly from the future financial performance expected at the current time. Those risks and uncertainties may include, among others: economic factors affecting consumer confidence and discretionary spending and reducing the consumption of food prepared away from home; the extent and duration of the negative impact of the COVID-19 pandemic and its consequences on the Company; cost inflation/deflation and commodity volatility; competition; reliance on third party suppliers and interruption of product supply or increases in product costs; changes in the Company's relationships with customers and group purchasing organizations; the Company's ability to increase or maintain the highest margin portions of the Company's business; achievement of expected benefits from cost savings initiatives; increases in fuel costs; changes in consumer eating habits; cost and pricing structures and other governmental regulation, including actions taken by national, state and local governments to contain and/or respond to the COVID-19 pandemic and its consequences; product recalls and product liability claims; and our reputation in the industry. The forward-looking statements contained in this press release speak only as of the date of this press release and are based on information and estimates available to the Company at this time. We undertake no obligation to update or revise any forward-looking statements, except as may be required by law. The best source of information on the company is the OTC Markets website (
Business Wire
05-05-2025
- Business
- Business Wire
Armanino Foods of Distinction, Inc. Reports the Highest First Quarter Profits in Company's History
PLEASANTON, Calif.--(BUSINESS WIRE)--Armanino Foods of Distinction, Inc. (OTCQX: AMNF) reported its highest quarterly profits ever for the first quarter ending March 31, 2025. ARMANINO FOODS OF DISTINCTION, INC. REPORTS THE HIGHEST FIRST QUARTER PROFITS IN COMPANY'S HISTORY Net sales for the first quarter of 2025 were $16,978,865 compared to $15,720,317 for the same period last year, an increase of 8%. Income before taxes for Q1 2025 was $5,290,611 compared to $3,115,981 for the same quarter in 2024, an increase of 70%. Net income for Q1 2025 was $3,936,215 (or $0.1243 per share), compared to $2,318,160 (or $.0723 per share) for the same quarter a year ago, an increase of 70% (or 72% on a per share basis enhanced by the buyback of 385,177 shares of common stock repurchased in Q1 2025). Working capital as of March 31, 2025 was $25,510,009, down from $26,138,978 on December 31, 2024, a decrease of 2%. This decrease was due to returning more cash to shareholders via higher dividends and stock repurchases under the Company's stock buyback program. Edgar Estonina, CFO as well as acting President and CEO, stated, 'We continue to shatter our year over year performance thanks to our margin improvement efforts. Specifically, we have maintained discipline in executing our sales strategies including the acquisition of new customers and the expansion of sales of our core products into new markets. We also benefited from year over year improvements in our operational efficiencies, and better procurement of raw materials. Operating margins this quarter were aided by a significant non-cash reduction in phantom stock compensation expense, reversing the elevated levels recorded over the past year. The after-tax benefit was a material contributor to the improvement in SG&A as a percentage of sales.' Douglas Nichols, Chairman of the Board, added, 'On behalf of the Board, I extend our sincere appreciation to all Armanino employees—and in particular to our acting CEO Edgar Estonina, along with our accounting, sales, and production teams—for their outstanding performance this quarter. Despite navigating a period of significant transition—including the appointment of a new CEO, engagement of a PCAOB-registered independent auditor—all while operating in a volatile business climate, our team remained focused and once again delivered record-breaking results. Their dedication and resilience reflect the strength of Armanino's culture and operational excellence.' Estonina concluded, 'We remain somewhat cautious in the near term as we believe there is some indication of a slowdown, particularly in the restaurant industry. Furthermore, we are closely monitoring global trends regarding US and international tariffs to assess the impact so that we can plan and act accordingly. To help mitigate these potential risks, we will seek further operational efficiencies in pursuit of improving our low-cost structure and continue to pursue competitive pricing on our supplies and raw materials. Management remains confident in the Company's financial position. We remain committed to making appropriate investments to grow sales with a focus on new products, new markets, operational efficiencies, and potential acquisitions.' Armanino Foods of Distinction, Inc. is an international food company that manufactures and markets frozen Italian specialty food items such as pestos, sauces and filled pastas to the foodservice, retail, and industrial markets. In addition to a classic Basil Pesto, Armanino offers other flavors such as Cilantro, Dried Tomato & Garlic, Roasted Red Bell Pepper, Southwest Chipotle, Artichoke, Roasted Garlic, Light Basil Pesto, Chimichurri, Harissa, Bolognese, Alfredo sauce, Creamy Garlic, and Romesco. Armanino's organic line includes classic Basil Pesto. Armanino Foods also offers cheese shakers, frozen pastas, meatballs, and prepared meals. Cautionary Statements Regarding Forward-Looking Information: The declaration of cash dividends in the future, pursuant to the Company's dividend policy, is subject to final determination each quarter by the Board of Directors based on a number of factors, including the Company's financial performance and its available cash resources. For this reason, as well as others, there can be no assurance that dividends in the future will be equal or similar to the amount described in this press release or that the Board of Directors will not decide to suspend or discontinue the payment of cash dividends in the future. Statements in this news release regarding our expectations and beliefs about our future financial performance and trends in our markets are 'forward- looking statements' as defined in the Private Securities Litigations Reform Act of 1995. Forward-looking statements often include the words 'believe,' 'expect,' 'anticipate,' 'intend,' 'plan,' 'estimate,' 'project,' or words of similar meaning, or future or conditional verbs such as 'will,' 'would,' 'should,' 'could,' or 'may.' The forward-looking statements in this news release regarding our future financial performance are based on current information and because our business is subject to several risks and uncertainties, actual operating results in the future may differ significantly from the future financial performance expected at the current time. Those risks and uncertainties may include, among others: economic factors affecting consumer confidence and discretionary spending and reducing the consumption of food prepared away from home; the extent and duration of the negative impact of the COVID-19 pandemic and its consequences on the Company; cost inflation/deflation and commodity volatility; competition; reliance on third party suppliers and interruption of product supply or increases in product costs; changes in the Company's relationships with customers and group purchasing organizations; the Company's ability to increase or maintain the highest margin portions of the Company's business; achievement of expected benefits from cost savings initiatives; increases in fuel costs; changes in consumer eating habits; cost and pricing structures and other governmental regulation, including actions taken by national, state and local governments to contain and/or respond to the COVID-19 pandemic and its consequences; product recalls and product liability claims; and our reputation in the industry. The forward-looking statements contained in this press release speak only as of the date of this press release and are based on information and estimates available to the Company at this time. We undertake no obligation to update or revise any forward-looking statements, except as may be required by law.
