Day: September 13, 2021

Understanding Facial Recognition in Your Own Backyard

If you’re not familiar with facial recognition (FTR), it’s time to learn the basics.

The reality is, it’s already playing a part in your life whether you know it or not. FTR is a type of biometric technology that mimics how people identify or verify others by examining faces. Recent advancements have increased the accuracy of automated FRT. The result? More communities are adopting it than ever before across a range of applications, but the technology is still far from perfect.

Critics like civil liberties groups argue facial recognition contributes to privacy erosion and reinforces biases.

Despite concerns, the use of FRT continues to explode, so it’s increasingly important to understand its use in government. That’s why GAO recently conducted a survey to learn how federal governments are implementing this technology. Currently, most state legislatures – including New York – have rejected bans and severe restrictions on facial recognition. So what does this mean for the future of public safety in your community?

GAO’s report surveyed 24 federal agencies about their use of FTR:

16 reported using it for digital access/cybersecurity, such as allowing employees to unlock agency smartphones with it
6 reported using it to generate leads in criminal investigations
5 reported using it for physical security, such as controlling access to a building/facility
10 said they planned to expand its use through fiscal year 2023. For example, an agency plans to pilot the use of FRT to automate the identity verification process for airports travelers

At the municipal level, the number of localities considering broad bans on facial recognition has been limited in 2021 to just three.

Minneapolis and King County, Washington, passed bans on government use, while the Baltimore City Council recently approved the most expansive ban so far that also restricts personal and business use, joining Portland, Oregon, as one of the only two local jurisdictions out of 18 moving to restrict private-sector applications in addition to banning local government use.

So, how does the public feel about FTR?

Every community is different, so the residents in your community may be more supportive, or perhaps more skeptical than the survey results we’re about to share. Insight platform Piplsay polled 31,184 Americans this August to understand people’s views on the uses of facial recognition technology in public spaces. The poll respondents were told that some major U.S. retailers like Macy’s and Lowes have been using facial recognition to help to better detect organized retail theft. Forty percent of people surveyed were unaware of this fact and while 42 percent of people said they did not mind this, 38 percent did not support the use of the technology.

Many Americans surveyed on the subject agree that facial recognition is a helpful tool to crack down on fraud and crime, but the major concern seems to be a lack of transparency about the tech and the personal data being collected. The takeaway? If localities opt to simply disclose the use of the technology to the general public, it would likely garner more widespread support. The best gauge would of course be to start an open dialogue at your next in-person, or virtual community meeting.

What’s the latest here in New York?

New York City is the latest U.S. city to enact a biometric privacy law. Effective July 2021, the law puts new limits on what businesses can do with the biometric customer data, giving New Yorkers greater protections over how their data is collected and used. Businesses that collect biometric information — most commonly in the form of facial recognition and fingerprints — are required to post notices and signs at their doors explaining how customer data will be collected. The ordinance applies to a wide range of businesses — retailers, stores, restaurants, and theaters, to name a few — which are also barred from selling, sharing, or otherwise profiting from the biometric information that they collect. Businesses can face stiff penalties for violating the law but can escape fines if they fix the violation quickly. While your locality hasn’t yet adopted any specific biometrics or facial recognition laws, it’s bound to remain a hot button topic for years to come. It’s a good idea to keep this growing tech on your radar and check in with local leaders and constituents to gauge their perspectives. At RBT, we understand that governmental entities face enormous challenges every day and that it can be difficult to keep up with ever-evolving policies and technology. Please reach out to our trusted team if you have questions and feel free to schedule a consultation.

Sources: Biometric Update, Security Info Watch, GAO

New Lease Accounting Changes Your Company Needs to Know

As a part of daily operations, most contractors have leased vehicles, buildings, trucks, construction equipment or other items to keep costs down and business running smoothly. Did you know that, in a matter of months, your leases will be accounted for differently due to the new lease accounting standard? While previously only capital leases were recorded on the balance sheet, effective for fiscal years beginning after December 15, 2021, all leases will be on the balance sheet. That translates to January 1, 2022 for calendar year entities, and fiscal 2023 for non-calendar year end entities. What does this mean moving forward? It means contractors need to make sure they have a thorough handle on all of their leases. Now is the time to review and evaluate contracts.

The new definition of a lease under ASC 842:

“a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration.” This slight change means that all contracts should be evaluated to determine if they fall within the scope of this new criteria. Contracts that were previously considered leases may no longer meet the lease criteria and vice versa. Be mindful of lease language when you are reviewing your contracts.

There will still be two categories of leases.

The leases formerly known as capital will now be called finance leases. The classification criteria remain essentially the same as under the existing standard; the only major difference is the elimination of the bright-line percentages. All leases that do not meet one of those criteria will be classified as operating.

If a lease contract includes a non-lease element, that non-lease component must be accounted for as a separate contract distinct from the lease itself. For example, the cost of an equipment lease that includes a maintenance contract must be allocated between the two elements and accounted for separately.

Lease liabilities for operating and finance leases will all be accounted for in the liability section the same way capital leases currently are: split between current and long-term. The offset to the liability will be a right of use (ROU) asset. There will be two lines: a ROU asset – operating lease line, and a ROU asset – finance lease line. These ROU assets are all long-term.

The new standard was designed so that there should be minimal impact to your income statement.

Operating leases will continue to be recognized as a straight-line expense over the life of the lease. Finance leases will continue to be frontend loaded because the interest is higher at the beginning of the lease than at the end.

The most significant impact will be on the company’s current ratio.

Because the ROU assets are all long-term but the lease liability is split between current and long-term, the current ratio will be negatively impacted. This change will be particularly important for entities with debt covenants that reference the current ratio. If you have significant operating leases that may create an issue with your debt covenants, connect with your bankers now and make sure that they are aware of the new standard.

Ultimately, it’s important that both the borrower and the lender understand that this is a reporting change, not a change in a company’s financial situation.

Having this conversation early on instead of waiting until the last minute will avoid confusion, and a lot of headaches. If you’d like to get a head start so you aren’t scrambling to figure out the logistics once January arrives, the time to act is now.

Need to Know: Biggest Blockchain Benefits

To stay competitive and successful, New York manufacturers need to embrace the latest innovations.

In recent years, manufacturers around the world are becoming increasingly interrelated using blockchain technology. How popular is the technology? Amid the COVID-19 crisis, the global market for blockchain in manufacturing was estimated at $32.6 million in 2020, and is projected to reach $980 million by 2026 according to a new market study published by Global Industry Analysts Inc., (GIA).

Blockchain technology has the potential to transform the supply chain by automating processes and making it virtually impossible for someone to make unauthorized changes. It can streamline the supply chain, improve transparency, facilitate auditing and reduce costs. So, how can you maximize the benefits of this technology?

Wait, What Is Blockchain?

First, let’s make sure you know what blockchain is, and we’ll go from there. Blockchain is a database that relies on a chain of data blocks and is linked by cryptography. It’s designed to deter data modification. Instead, once the data is recorded, it can’t be altered retroactively, making it difficult for a single user to gain control of the system.

One of the main differences between blockchain and a typical database using tables is the inherent structure. With blockchain technology, the information is stored in the blocks holding various sets of information. When the block is filled, it’s added to the existing chain. Any new data that’s compiled is stored in a new block that can be subsequently added to the chain. If you’re still struggling to understand this technology, here is a helpful short video you can watch to illustrate it further.

Blockchain Benefits?

Blockchain technology offers enhanced visibility across the entire manufacturing process, including operations at supplier warehouses, on the plant floor and all along the supply chain. As participation grows, users can benefit from the ledger structure to improve efficiency. Blockchain technology may help improve the following aspects of the manufacturing process:

Identification of problems in products

Product designs

Identity management

Asset and procedures tracking

Quality assurance

Compliance with regulations

Overall efficiency

Which Operational Aspects Are Improved?

Part of manufacturing is constantly improving your operation to boost efficiency. The main areas blockchain can help manufacturers in is improved performance and product quality. Ultimately, this leads to increased revenue and profits. Manufacturers who use blockchain typically see results in the following four areas of day-to-day business operations:

Quality control. Besides in-depth tracking up and down the supply chain, blockchain creates definitive documentation of quality checks and production data. Significantly, the database tags each product and automatically records each transaction, including quality checks and updates.

In addition, the system may be set up to provide automated quality checks that generate and write measures directly to the blockchain. This eliminates the need for other traditional checks for quality control involving suppliers. It may also reduce the number of audits required for verification of quality controls.

Tracking and tracing.Data is more transparent and accessible through blockchain technology. The system provides a permanent digital record of materials, parts and products, creating a single “voice of authority” for all participants.
Better maintenance.Blockchain creates the potential to support maintenance improvements, such as automated service agreements that can accommodate the influx of new types of machinery. With blockchain, machines can easily be scheduled for maintenance and serviced with greater speed and efficiency. For instance, a request for machine maintenance or a replacement part may be automatically triggered. After the procedure is performed, payment processing is instantly implemented. In addition, blockchain keeps track of maintenance records. These procedures are currently still in the development phase, but they’re widely viewed as an important component of the system.
Intellectual property protection.Don’t ignore the role that blockchain can play in protecting intellectual property and deciding whether to produce parts in-house or with an outside supplier. The blockchain data may create a virtual certificate of authenticity, helping prove that property is owned in the event of a patent dispute.

What’s Next?

Blockchain technology may result in a new business model for manufacturers to achieve competitive advantages in 2021 and beyond. Wondering if this technology is right for you? Contact RBT’s team of dedicated professionals now to discuss whether this approach should be a part of your long-term strategy.