Stabilisation

1.1 - Financial Review of Short Term Cash Flow

BDO’s Financial Review services are an essential component of our Restructuring Advisory practice; informed decisions require robust information.  Without effective, objective analysis and understanding of a business’s current position, trading history and projections, a credible restructuring plan cannot be formulated.

Review Of Short Term Cash Flow

• Normally a review of a 13 week daily cash flow forecast.
• Does the business have sufficient working capital facilities to trade on while restructuring options are explored?

1.2 - Working Capital Management

To be effective, working capital needs to be managed on an integrated basis. We take an ‘end to end’ approach to each of the business processes which form working capital with our methodology crossing from suppliers into stock holdings, and receivables all the way through to cash management.

Value can be created through effective working capital management. Business processes such as supply chain, inventory, receivables and cash management are rarely fully integrated within the finance function, nor are staff motivated to optimise working capital. Driving out efficiencies and cash through best practice is key to managing both healthy and underperforming businesses.

We work with businesses to identify the potential benefits available, provide an added value cost / benefit analysis of the various options and ultimately; examples of potential benefits include:

• reduction of overall inventory levels (raw materials, WIP and finished goods)
• reduction of slow and obsolete stock levels and write-offs.
• increase in customer service levels by shortening order fulfilment lead-times, but balancing this with inventory levels
• reduction of debtor lock up and bad debt, whilst increasing customers service levels within the order-to-cash process
• optimising payables position to minimise working capital requirements, ensuring an adequate trade-off between discounts and terms
• assisting management teams to visualise, measure and hence manage working capital as one integrated process within their business

Stage two >