SUPPORTING A SUCCESSION PROCESS
A services company was going through a retirement succession process. The new owners, who were existing directors of the business, wanted an independent pair of eyes to validate the cashflow to assess the affordability of the deferred consideration payments. We analysed the company’s in-house forecasts and compared them with forecasts produced by external advisors. Having identified various critical differences we produced a simplified forecast set and conducted some sensitivity analyses to meet the needs of the proposed new owners. We suggested a few simple changes (for example, timing quarterly deferred consideration payments away from quarterly VAT payment dates to reduce cashflow spikes). The buyout then proceeded smoothly.
At the same time the company’s existing senior finance employee decided they would seek new employment opportunities. We provided some interim cover on a part-time basis to oversee the smooth running of the finance function, and also assisted with recruitment process for a new individual. This consisted of redefining the job description to meet the priorities of the business going forwards, working with recruitment consultants, reviewing candidates’ CVs, and assisting with technical interviews.
Once the new employee was in position, we conducted a brief handover to conclude the project.