Financial Health Check & Business Performance Analysis

Sound financial control is critical to a business' survival, growth and profitability. Setting annual cash and trading budgets are a vital part of the process, along with regular monitoring of performance against budget and the updating of the budgets. Many SMEs do not have the resources or are too busy with day-to day matters to carry out this procedure thoroughly, if at all. Accurate information is key to senior management/directors being able to take good management decisions. Critical decisions such as investment, employment levels salaries etc., need to be based on accurate and up to date information not on gut feel and instinct. Cash is King, without enough cash in the system, under-performing businesses can go under while even profitable businesses can have their growth restricted.

Forecasts and budgets should be updated on a regular basis in line with actual performance, ideally every month, so that senior management can guage where the business is heading and can take appropriate action to correct any under-performance on a timely basis rather than have a nasty shock some months after the year end when the Financial Accounts are prepared. SMEs who do not have the resources to undertake regular monthly budget reviews and updates should consider engaging the services of external consultants such as Menter Business Advisors to undertake review and updating of their financial forecasts and budgets on a half-yearly basis in order to retain sufficient control on the business to be able to take informed decisions.

In addition to reviewing and updating the forecasts and budgets we would also carry out the following additional analysis;

  • Sales Level Analysis
  • Gross Margin Analysis
  • Net Margin Analysis
  • Stock Level Analysis

Where possible the above would be compared with competitor and industry average performances

Business Turnaround / Recovery Advice and Assistance

We can work with senior management to devise a corporate restructuring and workable recovery strategy and assist in its implementation, including conducting negotiations with HMRC, bankers, trade creditors and others. The overall cost effectiveness of our involvement will be determined by how early we are called to assist. An early call is more likely to produce a positive and cost effective outcome. We can take an independent and unbiased view of the business' affairs unclouded by direct financial involvement and can use our various contacts including Business Angel contacts to negotiate a rescue package if the business is capable of being saved.

Retirement and/or Succession Planning

Too many SME owners / directors approach retirement age without having given sufficient if any thought to their exit route and without having in place a suitable individual or team to carry the business forward. This can lead to the distressing and in many cases unnecessary demise of the business, resulting in employee hardships and a significant loss of value for the owner when assets are sold off too cheaply. If involved at an early stage we can often assist the owner(s) /directors to devise a workable exit strategy and put in place the necessary processes and structures to enable that strategy to be successfully implemented.

The services can be taken individually or as a package.

Key Benefits

Benefit 1 - Cost effective services
Benefit 2 - Pro-active, hands-on approach tailored to the specific needs of SMEs
Benefit 3 - Access to an experienced accounting professional with a wide range of sector experience