Consulting Services:

Cash and Working Capital Management

Cash receipts and disbursements do not always balance out to a steady, gradual increase in cash, even if the company is making steady profits. Over the short-term, cash balances of any company have the potential to fluctuate considerably. Because of this, those responsible for the organizations’ cash management must be able to anticipate a cash surplus or deficit, and take appropriate action in a timely manner either to borrow or invest funds.

Working capital is closely connected with cash, but it’s not the same thing. Indeed, a positive growth in working capital can mask a deteriorating liquidity position. An increase in inventory and working capital may occur because customers are not buying the company’s products.

The business-consulting group at Sisterson will look at your company’s financial management in terms of the following five objectives.  We will:

1. Analyze your current situation for maintenance of short-term financial flexibility.  That is, always maintain cash to meet the company’s legal obligations and maintain liquidity.
2. Help arrange funds from external sources at the right time, in the right form, and at the best possible terms.
3. Advise your organization to ensure assets and liabilities, current and long-term, financial and operating are utilized as effectively as possible.
4. Prepare cash flows and working capital forecasts to plan for financial requirements of future operations.
5. Make recommendations that maximize the long-term value of your organization.  That is, maximize the wealth of the owners.