Ongoing profit and loss, liquidity and cost accounting

A question which has to be stated by every entrepreneur in today’s climate of profit margins slimmer than ever. A question that sounds very simple yet is very hard to answer. The reason is that most companies don’t have an exact calculation and cost controlling.

This is where our consulting sets in. We help you to implement an individual cost and profit and loss accounting system custom made for your company. Although the necessity for an exact controlling is undisputed many companies don’t have a working one. The reason often times is a consultant who was working very theoretically. The implemented controlling is not taken on by the staff because it is just too complicated. This results in many companies having to answer question like the following based on a gut feeling:

Shall we take on this order?

Shall we order this machine?

Without really knowing the exact basics of their decision.

The risk to make a faulty decision is unnecessarily high. Especially in the current climate this can endanger the existence of a company.

We develop a custom made cost and profit and loss accounting system for your company – as little theory as possible, as much individualism and practicability as possible – and we don’t leave it up to you to actually use it. We school your staff until they really grasp the system and you can see results.

ongoing liquidity accounting good orders but no cash in the till?

Liquidity means being able to pay. This is the case if your company is able to pay its outstanding debt at any time without any problems.

Liquidity controlling is usually carried out through the payment management system to enable a company to:

• at any time
• in any part of the company
• in any currency
• at the lowest costs possible

Ensure liquidity in the required amount. So the task of liquidity management is to ensure the continued liquidity and to use the cash assets in the company’s best interest (investing or rearranging) to make sure the desired profitability goals are met.
Unfortunately liquidity and profitability are mostly conflicting objectives. Thus measures to ensure liquidity always have to be weighed against measures to ensure profitability to guarantee decisions in the company’s best interest.
In practice the following mistakes and weak spots are often found in the cash management of a company:

• too much stock
• too high customer receivables
• bank accounts with low interest and bank loans with high interests at the same time
• missing or failure prone financial planning, thus expensive usage of overdraft lines
• No or not sufficient usage of discounts

We support you with checking your current situation as well as taking care of weak points we find.
Based on your financial accounting we can also take care of your payment management on your behalf.