Setting the Standard for Future Planning
Having recently acquired two companies and in the process of integrating the acquisitions, the Company lacked sufficient FP&A resources to build a detailed and reliable budget for the consolidated Company. This is where we came in. Our Accordion team was engaged to assist in the development of the budget and cash flow forecast.
Process & Controls Implementation
Stakeholder Reporting & Strategic KPI Enhancement
Budgeting & Forecasting Process Improvement
We deployed a committed full-time team to execute the budgeting process – engaging seamlessly with the Company’s Finance team to drive the required work streams. Specifically, our work entailed the following:
- Corporate Budget Validation – We worked with the SG&A Division managers to review their respective budgets, probing appropriation requests, and working with stakeholders to determine realistic funding needs versus available resources. Our senior technology consultant worked with the IT team to perform a multi-year capex and capitalize development spend planning, validating contracts renewals and redundant expenses.
- Consolidation and Validation of Operating Budget – Our team worked with senior management to review revenue and cost of goods budgets submitted by the operations managers, performing numerous analytics, including pressure-testing revenue and margin assumptions and isolating aggressive targets for management’s review. This work with senior management was iterative and led to top down adjustments to budgets that increased revenue by approximately 8% and margins by 400bps.
- Forecasting Model Development – We built a dynamic forecasting model enabling views not just of the P&L results, but projected Balance Sheet and Cash Flow statements, as well. The model enabled the company to stress test liquidity and monitor bank covenants.
- Overhaul of Reporting – By leveraging our work on the budget and forecasting models, our Accordion team worked with the CFO, the finance team, and Division heads to revise monthly and quarterly report templates for the Company leadership, Board of Directors, financial sponsor, lenders.
Ultimately, we delivered a thorough and robust budget for 2016 to the Company’s Management Team and Board of Directors in advance of the crucial budget board meeting, which became the basis of future planning for all participants.