Executive Session: Tricia Fulton

Executive Session: Tricia Fulton

CFO, Sun Hydraulics

Even before Tricia Fulton became chief financial officer for Sun Hydraulics earlier this year, she was already busy heading one of the most challenging accounting projects in the company. Last year, she led Sun's efforts in complying with Sarbanes-Oxley rules, testing and documenting Sun's internal auditing procedures. Fulton took over the CFO chair from Richard Dobbyn, who retired from the valve manufacturer in March.

Here's a glimpse of Fulton's career and what she has to say about her experience with the controversial Sarbanes-Oxley Act:

Personal

Age: 39

Family: Two boys; Jake, 11 and Max, 8

Education: Hillsdale College, Hillsdale, Mich.

Books on her nightstand: "The Simple Truth," by David Baldacci; "The Da Vinci Code," (in preparation for the movie) and "Angels and Demons," both by Dan Brown.

Favorite Band: O.A.R.

Favorite television shows: HBO's Entourage and Grey's Anatomy

Music: Country, Jack Johnson

During the weekends: You'll find her at her sons' basketball/ football games or school plays or shopping, and occasionally at the Daiquiri Deck in Siesta Key village.

Favorite restaurants in Sarasota: Tommy Bahama on St. Armand's; Selva Grill and Caragiulos in downtown; and Thailand restaurant on Gulf Gate Drive.

The first thing she does in the morning: Check e-mail from CFO.com and wallstreetjournal.com. "That's how I keep on top of things."

Hours worked: 40 hours a week. "But I'm always thinking about it."

Industry

On the new regulations mandated by the Sarbanes-Oxley Act of 2002: Fulton took on the SOX project last year and the company met its goals of becoming compliant by the end of the last fiscal year. "We don't have horror stories like other companies do. It was hard because we didn't know what our end goal was." Sun Hydraulics falls in the $250 million-cap tier and is considered a member of the small-sized group. The federal government is in the process of considering less stringent SOX rules for smaller companies.

How did you comply? "We hired an outside consultant, ICX, from Tampa. It was very time consuming." Fulton and her staff had to validate all accounting procedures and test whether they were accurate and effective.

How much time was spent on it? About 20% of the entire accounting staff's work hours were spent on SOX related issues. "And we did it at a time when our business was growing so much."

What was the biggest challenge? "The hardest part was coordinating with our foreign subsidiaries because they're not under U.S. law. They didn't understand why they had to do it. Korea was especially difficult because of the language barrier."

How much did Sun spend in compliance issues? $500,000 in 2005, the first year the company became compliant.

How does that compare to other companies? "That's lower than average, especially considering that we have foreign subsidiaries. Many companies our size spent double, about $1 million."

How much do you project spending this year? "It depends. We'll spend about $400,000 if the rules remain the same, $300,000 if they become less stringent."

Has SOX compliance made Sun change some of its auditing practices? "No. We've decided that there really has been no great benefit to the company. We're interested to know what investors think about it, whether it has benefited them. But we knew we had the right internal auditing processes in place. We just needed to document and test them."

Professional

Jobs prior to Sun Hydraulics: Fulton was an auditor at Deloitte and Touche in Detroit from 1989 to 1991, an accounting supervisor at Loral Data Systems in Sarasota from 1991 to 1995 and the director of accounting at Plymouth Harbor, a continuing care retirement community in Sarasota, from 1995-1997. Dobbyn, who worked with Fulton at Loral Data, recruited Fulton to Sun in 1997.

Responsibilities: Fulton supervises five controllers from Sun's foreign offices, as well as the corporate controller from the Sarasota office. She also is the manager of the new sales and marketing office in France. In 2005, much of her time was spent assessing the right way to protect the company's assets. The company had windstorm studies done for its two manufacturing buildings in Sarasota and Manatee counties; its property and casualty insurance policy increased by 20%.

How did you advance with Sun? "I started out as the plant controller for the two operations in Sarasota. In 2000, I became the corporate controller. I would consolidate the [financial statements] of all the foreign operations and the U.S. operation."

She then began 'sharing an office' with Dobbyn - Sun speak for cross-training employees to share responsibilities. "Honestly, when I first came here, it wasn't necessarily a goal of mine to become CFO. But I was given the chance to get involved in as many projects as I wanted, including implementing payroll systems and streamlining internal processes."

Future goals: "I'm looking at more strategic leadership within the company, not just from a financial perspective. I'd like to help with all the strategic decisions related to marketing and operations."

What's the most challenging part of the business? "The technical side. Hydraulics is not an easy concept for an accountant to grasp. I'll be taking classes that we provide our distributors, so I can learn more."

- Isabelle Gan