COMPANY PROJECTS – FINANCAIL

Balance Sheet, current assets and cash flow

The Balance Sheet is just as important as the Profit and Loss Account, as it tells how assets are performing. It needs to be reviewed monthly to identify trends in receivables, inventory, payables and cash outflows that do not appear on the P&L so as to develop a cash from operations statement and ensure that key ratios are being reported.


Ability to finance growth internally (overtrading)

Overtrading occurs when the dynamics of the business mean that, as revenues grow, current assets grow faster than current liabilities so that the business can literally grow itself out of cash. The answer to this problem is not simple, and may require a slowing down of growth or a change in the business model.


Availability of outside finance

Some businesses are bankable and others are not. Much depends upon the business that you are in and, more importantly, the kind of assets you have. Banks like receivables (but not service receivables) and dislike inventory, plant and machinery. There are some other hidden assets such as patents and contract rights that some banks will lend against, and these are often overlooked.


Organization and Structure

Employee Issues

Sales and Competition

Operations