(FORTUNE Small Business) – Chapter 11 Hardship Pay

You might think companies that have filed for Chapter 11 would be looking for ways to cut costs. But increasingly, bankrupt companies in a host of industries, from retailing to telecommunications, are offering top-performing managers huge bonuses to stay on. As the economy has soured, such bonuses have become a popular perk used to prevent stars from jumping ship, according to Carl Eklund, a bankruptcy attorney at LeBoeuf Lamb Greene & MacRae in New York City.

These golden handcuffs are pricey. While most pay-to-stay bonuses equal the value of an employee's severance package, some are double a person's annual compensation (salary plus bonus).

Are they worth it? They can be, says Eklund, if the executives can help the company steer clear of past mistakes. Keeping these managers involves drawing up an employment contract that stipulates that the employee remain loyal until the firm is on track again.

The Ol'Gal Money Hunt

Women who hit the glass ceiling and leave corporate America to start their own business may be in for a surprise: The entrepreneurial world has its own brand of sexism. According to a new study conducted by researchers from five top schools, including Boston University and Harvard University, women own about a third of all privately held businesses in the U.S. but attract less than 5% of all equity investments. The study, named the Diana Project--for the Roman goddess of the hunt--notes that in the past five years the amount of VC money for women has doubled. Now gals have to dispel the myth that they don't have the skills to build big ventures to get their fair share.

Total number of privately held businesses

Men own 72% Women own 28%

Share of VC deals in 2001

[men] 95% [women] 5%

Source: the Center for Women's Business Research; The Diana Project and Venture Economics

Accounting Made Easy

Unless they keep their books like Enron, small businesses should find this tax season forgiving. Now businesses with revenues of $10 million or less will be able to use the cash method of accounting. The old rules required firms with more than $1 million to use the accrual and inventory method of tax payment. Accrual accounting dictates that income and expenses are counted (and thus taxed) as the company earns or incurs them, even though payment may not have been received.

The new cash system of accounting counts income only when payment is received, and expenses when money is paid out. "It should remove a huge growth impediment for small firms," says Senator Kit Bond (R-Missouri), who was a big proponent of the changes.

Reported by Jennifer Keeney and Maccabee Montandon