Cashcow CFOs instated a dynamic pricing model at a manufacturing client, through cost accounting techniques and expense management which empowered the sales team to instantly close deals and ensure budgeted profit margins

Financial transaction process optimisation | Forecasts & Budgeting Product Cost Analysis | Cost containment & Expense Management

Situation :

The client was operating with a conventional cost sheet (fixed costing structure) for past several years. As the company grew the costing structure became complex and went beyond the skillset of the accounting staff to include all the relevant costs. Due to this the product cost was far away from being realistic and dynamic. Also, the sales team took at least a couple of days to give final quotes to prospective clients during the negotiation phase as they were unaware of the discounts that could be offered.

Our Approach :

1. Set-up of processes and their integration with systems to ensure that all the costs being incurred in the organisation are captured with accuracy and all relevant details.
2. Implemented proper inventory control procedures and materials handling practices to better safeguard and track inventory from manufacturing to distribution worldwide.
3. To supplement daily implementation and execution by providing ground support, Cashcow provided the CFO with an assistant staff cum controller.
4. Streamlined monthly closing process and budget review meetings that assisted the company in obtaining and utilizing accurate, timely financial reporting.
5. Developed and implemented a dynamic pricing model through above efforts and other measures.

Result :

The dynamic pricing model gave accurate costing for a sales order, marked it up with the budgeted margins and also provided discount thresholds which could be offered. It also accounted for any historical deviations from the budgeted targets. This enabled the sales personnel to negotiate better with clients and close sales instantly.

Helped the client secure credit facilities worth INR 1000 million based on preparation of elaborate projections and a detailed study of the project. This helped the management get the right amount of funds through a suitable medium at a low cost.

Project Finance | Credit Assessment and Advisory Financial Projections | CFO Consulting | Expansion Strategy

Situation :

The client, a pharmaceutical manufacturing company, with units at different locations in India wanted to expand its presence in Western India by setting up a plant in the state of Gujarat. The client had revenue of ~INR 2500 million (combined with its subsidiary) of which ~70% were exports.

Our Approach :

1. Firstly, our debt team had an extensive discussion with the promoters to understand the project thoroughly.
2. We then prepared a project plan and arrived at the project cost detailing each cost component.
3. We prepared the project timelines, studied the financials and collated the necessary documents (blue prints, drawings, maps, title deeds, agreements, instruments and other papers related to primary and collateral property) for valuation & legality check of the project to decide the correct means of the finance.
4. We also coordinated with external parties for Techno-Economic Viability (“TEV”) report, Valuation Report, and Title Search Report (“TSR”) and arranged the factory visits with the teams.
5. Since ~70% of the company’s revenue was in foreign currency (majorly in US dollars), we decided for an External Commercial Borrowing (ECB) route for their term loan requirements worth INR 850 million; while the working capital requirements worth INR 150 Million could be secured through domestic channels.
6. After prepping the client for approaching bankers: completing our in-house credit analysis and documentation, we met different bankers sharing the details and clarifying their queries to get their proposals.

Result :

After all the above processes and active follow ups with the banks and the other involved parties, we received the sanction and disbursement from a banking consortium (lead bank: 60%): INR 850 million ECB term loan and INR 150 million worth working capital from domestic banking channel. Leveraging on our expertise, experience and network in the debt industry we helped our clients to prepare for availing the requisite credit facilities w.r.t. documentation, financials and other requirements before approaching the bankers. We also helped them choose the right mode and amount of finance and avail it through the preferred bankers at low costs.

Cashcow CFOs were roped in to fix the existing accounting systems for enabling quicker closure of books and production of timely accurate reports.

Finance function transformation| Process Structuring Financial Reporting | ERP & Accounting System Implementation

Situation :

The accounts department of the client, a manufacturing concern, was unable to generate reports as required by the management due to lack of synchronisation of the ERP and accounting system. The monthly closure of books was also a tedious task for the accounts team. The management often spotted errors and irregularities in reports and failed to hold responsibility due to lack to audit trails.

Our Approach :

1. Firstly, we met the accounts team and visited the factory of the client to understand the data capture points and existing accounting practices.
2. We found gaps between accounting software and ERP, lack of access-restrictions and segregation of duties.
3. Basis our observations, we drafted an elaborate plan to integrate all the existing processes with the ERP, by activating all of its modules and bridging the gap between the accounting software and ERP.
4. We implemented a robust mechanism for mirroring the ground level operations in the ERP to avoid any data gaps, setting up KRAs to avoid conflicts regarding scope of work, enforcing restriction of accesses and implementing a maker checker policy to reduce chances of errors and frauds.
5. We synced the masters of the ERP and accounting software, and linked both of these to facilitate direct posting of entries. This helped save time and cost without hurting accuracy of data and controls over it.
6. After understanding the requirements of the management, we got custom reports designed in ERP and enabled automatic mailing of these reports to management regularly for monitoring and control purposes.
7. Enabled a seamless flow of the billing data from accounts to factory without requiring the factory staff to access accounts and instated a system of bill approval to avoid any frauds and errors.

Result :

Setting up data flows and a maker-checker model reduced errors and delays in report generation. Syncing the ERP with accounting software and setting up a module for recording invoices in HO (instead of factory) reduced the time lag further. This helped the client to close its books of accounts by 10th of the subsequent month and enable the management to revise its plans and take prompt corrective actions.

Kshitij looks after business development and CFO consultancy at Cashcow. Kshitij did his masters’ in business administration with specialisation in finance from University of Mumbai.

Marketing | Business Development | Negotiation Process Implementation | Resource Management

About Kshitij:

Kshitij looks after business development and CFO consultancy at Cashcow. Kshitij did his masters’ in business administration with specialisation in finance from University of Mumbai.

Prior to this, Kshitij was working with a multinational company in the pharma industry, with the Corporate Finance team.

Part of the 'Mentorship Program' at Mumbai Educational Trust, he takes great pleasure in guiding MBA aspirants to achieve their goals.

Vishal has over 4 years of financial experience with expertise in research, valuation and business analysis. He has also worked on evaluation of credit proposals and has coordinated with credit rating agencies, valuation officers and bankers for his assignments.

Business Analysis | Credit Assessment & Advisory| Negotiation Actual to Budget Analysis | Strategic Advisement

About Vishal:

Vishal has over 4 years of financial experience with expertise in research, valuation and business analysis. He has also worked on evaluation of credit proposals and has coordinated with credit rating agencies, valuation officers and bankers for his assignments.

Prior to working with Cashcow, Vishal worked as an Equity Research Analyst performing valuation of companies, building financial models and writing research reports.

He has done his Master’s in Business Administration from Amity University and pursued his bachelor’s in business administration from New College, Shivaji University.

Shreya Shah is a CFO consultant and also looks after debt syndication & project finance at Cashcow. She brings over 3 years of expertise in the field of due diligence, valuation and audit of varied entities.

Project Finance | Debt Syndication | Budgeting & Forecasting Actual to Budget Analysis | Strategic Advisement

About Shreya:

Shreya Shah is a CFO consultant and also looks after debt syndication & project finance at Cashcow. She brings over 3 years of expertise in the field of due diligence, valuation and audit of varied entities.

She has worked for a wide gamut of clients in construction industry, steel trading, chemical industry, IT sector, event management, hotel industry & customer research.

Shreya is an Associate member of the Institute of Chartered Accountants of India and a graduate from KES Shroff College, Mumbai University.

Shivam Khanna has over 5 years of experience in handling finance, audit and taxation assignments for mid-market businesses across varied industries. His expertise includes marketing, negotiation and business process improvement.

Business Development & Marketing | Contract Negotiations Revenue Optimization | Financial Analysis | Internal Controls

About Shivam:

Shivam has over 5 years of experience in handling finance, accounting and reporting assignments for mid-market and small businesses across varied industries. He currently handles the business development and marketing operations at Cashcow.

He was previously associated with Morgan Stanley (India) as a financial analyst and controller. Prior to that he headed audit & tax assignment for a number of entities engaged in manufacturing, service, finance and NPO activities.

He is an Associate Chartered Accountant (ICAI) and holds a bachelor’s in commerce with specialisation in business & corporate taxation from University of Delhi.

Sakshi is a controller and CFO services facilitator. She assists CFOs in developing organizational strategies by contributing financial and accounting information, analysis, and recommendations to strategic thinking and direction.

Controller | Financial Statements | Actual to Budget Analysis Data Analysis | Performance Management

About Sakshi:

Sakshi is a financial controller and CFO services facilitator. She assists CFOs in developing organizational strategies by contributing financial and accounting information, analysis, and recommendations to strategic thinking and direction.

She monitors and analyses key performance indicators, establishes strategies and measurements, implements changes, evaluates variances to initiate any corrective actions.

She has done her Master’s in Business Administration from SCM Institute of Management and Technology with specialisation in Finance & Marketing and has also done her bachelor’s in commerce from MDS University.