ACCENT Ventures will review a companies financial planning and execution of the company’s financial resources — the cash it generates through its operations and the capital obtained from investors or lenders. It is not our intention to audit the financials, but to review how financial management is done and to provide direction of how to improve the management and reporting of the financials. There are four areas that will focus on:
A goal of the cash management function is to make certain the business enterprise always has the resources it needs to meet its financial obligations on time. A cash deficit compared to what the owner forecast can cause serious harm to the company’s image and operations. Managing accounts receivable and accounts payable is part of effective cash management. We will assure that the company is collecting all the funds due — the accounts receivable — as quickly as they can. Conversely, we will seek to assist you in stretching out the time it takes to pay bills from outside vendors. In doing so, we want to assure that the company does not get a reputation for paying so slowly that the suppliers insist on strict terms such as payment upon delivery.
Planning and Forecasting
The financial management aspect of planning involves accurately forecasting the company’s revenues, expenses and resulting net profit. The business owner uses the forecast — sometimes called a budget — as a tool to manage the company. ACCENT Ventures will assist the company in understanding how significant negative variances to forecast indicate that the business environment and the company’s performance in the marketplace are not what the company forecast, and adjustments need to be made. Analyzing these variances focuses the attention on changes the company needs to make to their strategies or operations to get the company back on course to reaching its goals.
A business owner and his management team require timely and accurate reports in order to make decisions and run the company effectively. We work with the staff members responsible for financial management and determine the key pieces of information the company needs for decision making. We then work with management to design reports that provide this information in a format that is most useful to the management team. The most significant metrics vary by the type of company.
Startup companies often need to obtain outside capital from wealthy individuals or venture capital firms in order to fund the company until it reaches the breakeven point. As the company grows, it may need additional infusions of capital to fund expansion. ACCENT Ventures work with the financial management function to determine the best form of capital for the venture — debt, equity or a combination — how much is required and when it is needed. Larger companies with stable cash flow can borrow funds from financial institutions rather than having to give up an equity share to investors in order to get the capital the company requires.