Question your business model
Try to estimate the impact on your clients. Crucial elements are forecasting the turnover, but in particular, estimating claims becoming due and payable. Are you able to approach your clients through a different channel, or with different products? The innovation plans that you had in the past will now perhaps gain momentum. Potential subsidies may give these plans an extra boost.
Scope out your working capital requirement for the months ahead
To scope out your working capital, we recommend that you perform an analysis of current and future outstanding receivables and payables and estimate, as accurately as possible, the evolution of inventory. This exercise is required as it will help you to make important decisions in the months, and perhaps even years, ahead.
Draw up a budget for the costs, expenditure and planned investments
Based on a clear budget, you can take the right decisions regarding the savings to be made. Perhaps enter into discussions with suppliers and potentially prioritise investment plans.
Try to absorb deficits
The previous points may lead to the conclusion that you will have to absorb deficits. A temporary bridging loan from the bank, combined with a Government guarantee, may provide a solution to this. However, to justify the application you will require the necessary supporting documentation. For exactly that reason, accurate figures are more important than ever and they contain, as a minimum, the following information:
- +Finalised annual accounts from your last financial year, with which you can demonstrate that your application fits into the framework of the budget you have drawn up and is a consequence of the crisis (and therefore is not required to finance past problems).
- +The interim figures for the current financial year.
- +Periodic reporting which is vital for sound company management and, as a result of which, banks will display a strong interest in how your company is doing at present. This way, the impact of corona on your company will immediately be clear.
- +A cash forecast, budgeted balance sheet and profit and loss account that illustrate the forthcoming months and longer. This is required in order to reflect the liquidity needs and to understand your company's direction.
'Monitoring' has always been 'monitoring', but in the time of corona, underpinned figures are an important action plan. We would be happy to assist you in the preparation of this plan and delivering accurate insights. In addition, we will ensure that you receive the support from the banks that you need.
Would you like to know more? Please contact your account manager or one of our specialists at firstname.lastname@example.org.
We base our advice on current legislation, interpretations and legal doctrine. This does not prevent the administration from being able to challenge it or to change existing interpretations.