eBook: reporting when it's not business as usual
Businesses are dealing with unprecedented challenges. They’re looking to you, their accountant, to help them navigate this uncertainty and provide them with options on what to do. So at Fathom, we’ve put together 12 helpful tips so you can get the most out of your management reports during these uncertain times.
Running to over 80 pages this free eBook is available to download here. Inside you’ll find advice on how cash flow impacts business, how to manage costs, and how to create a sustainable strategy for the potential leaner months to come. Now more than ever it’s important to know your numbers in order to guide and protect your clients and their businesses.
The 12 easy-to-follow tips are:
Knowing your numbers – we start by focusing on the importance of staying on top of your KPIs, and how they help to inform how the crisis is impacting your business
Tracking key trends – trend analysis is useful for answering a variety of important business questions and identifying trends in revenue, profitability, cash flow, working capital, growth, and liquidity.
Monitor breakeven and profitability – Another critical area for assessing profitability is the ‘Breakeven analysis’. Many businesses are reviewing the impact of different revenue scenarios and adjusting overheads to preserve breakeven or minimise the losses.
Controlling costs – Preserving cash during this period of business uncertainty is crucial, this section looks at how to review all business expenses.
Track profitability of business units – The Breakdown analysis in Fathom enables you to drill deeper and gain insights into the performance of business units within your business. Using this analysis you can see important metrics and identify which are vulnerable or needing attention.
Understanding your cash flow – Cash is the fuel that keeps the engine running, the lifeblood of the business. Using the Cash Flow analysis waterfall chart it is easy to visualise the flow of funds through the business.
Monitor drivers of cash flow – There are seven key financial drivers for cash flow. This section tells you what they are, and how adjusting each of them enables business managers to control the availability of cash in their business.
Moving the levers with Goalseek – The Goalseek analysis in Fathom helps you to answer the ‘How do we get there?’ question. For a range of financial metrics, you can identify what changes to drivers are required to achieve your goal.
Undertake forward projections – Forward projection trend charts and forward projection Profit & Loss statement (Income Statement) will be useful for clients. Both of these combine actuals and rest of year budget to provide a projection of the expected end of year financial results.
Create action plans – Action time! In the current business environment, cash flow projections and scenario planning are more important than ever. This section tells you how to create a workable plan for your clients.
Enhance communication to stakeholders – Regular communication with key business stakeholders, such as team members, investors, board members, lenders, and shareholders is now more vital than ever. Here’s how to keep everyone informed.
Know your at-risk clients or companies – The final tip is specifically relevant for business advisory firms and multi-entity organisations, such as franchise groups, and shows how Fathom’s benchmarking analysis enables you to compare the performance of multiple businesses (or business units) in a single view.
We recognise these are highly unusual times, and hope that our guide will help you get the most out of Fathom for your business or clients. Stay safe from all at Fathom.