Accounting Matters: Are the finance and accounting departments at your portfolio companies or prospective investments well managed? Or maybe you are having trouble with finance and accounting management at your own company. Are the proper processes and controls in place? Is there unnecessary risk? Does the company have the right staff, the right finance and accounting systems and the right policies?

In today’s challenging fiscal environment you want to be sure your financials and your portfolio companies are on the right track. Talk to AMS about a Rapid Diagnostic(TM) for your company or portfolio companies, or Due Diligence on prospective investments.

QUESTIONS TO ASK:

• Does the company’s forecast include a balance sheet and cash flow, or is it just a P & L statement? 
• How accurately does the company forecast revenue? 
• Does a single person review expenses and cut checks? 
• Does the company prepare an annual budget that is approved by the Board? 
• Are there any limits on spending without Board approval? 
• How often does the finance team update forecasts/review cash reserves? 
• Are well-defined Key Performance Indicators (KPIs) in monthly reports? 
• Are cash needs and burn rate reported regularly and truthfully? 
• Can the company forecast its “cash runway” dates accurately? 
• Is the company’s cash invested in risk-free, highly liquid, short-term investments with maturities in line with its short-term cash needs? 
• Does the company have sufficient visibility to short, medium and long-term capital requirements? 
• Does the company adequately manage, monitor and report on costs of customer acquisition, product development and team building? 
• Can the company consolidate some of its high interest debt to reduce the debt service costs?