Client:
Anonymous
Category:
Date:
December, 2024
Cathcap Case Study - Anonymous Business
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Problem Statement:
Due to the inefficiency and inadequacy of a staff bookkeeper, the finances of the business were essentially abandoned. Because of the lack of attention, financial visibility was next to impossible. Biweekly payroll was always an uncertainty due to the lack of knowing if funds were available to pay the employees.
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Context:
A couple of years ago, the client engaged Cathcap to set up the accounting foundation for the business. Once the foundation was set and metrics were in place, the client decided to proceed on their own with the implementation of an internal bookkeeper. Within a few years, the client’s financial picture had reached a state of non-visibility, and the client did not realize they were running a loss of $150K over a short period of 6 months. Additionally, taxes had not been prepared and filed over the course of those years due to lack of oversight into their finances.
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Solution:
The client reached out to Cathcap for reengagement for Fractional CFO services on an annual contract basis and Controller services for a short-term project.
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Approach:
We started the process with a deep dive into all financial systems, bank records, and PMS systems. Our team of analysts prepared their findings in a report relayed to the client’s executive committee with a proposal for a scope of work for Controller services.
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Implementation:
The first phase of our engagement on the project management Controller side was to clean up their financial systems and convert all data to QuickBooks Online. We converted data, reconciled all transactions to their bank accounts, and shored up all accrual-based accounting line items. After the clean-up, the CFO services side was able to verify the data and give them total financial visibility. Our team was able to analyze the data to draw a clear picture of their current financial positioning. We then were able to create a Profit Plan that we could use to execute against, build a Marketing Plan with benchmarks to a healthy ROI (return on investment), and structure a capacity plan so they would know when to hire employees.
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Results:
After 10 months of month over month losses, which the client did not know about due to lack of financial visibility, the client started turning a small profit. Three consecutive months later, their profit margin grew from double digit losses to a 9% gain.
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Outcome:
Due to the client’s financial collapse, the client has taken charge of all areas of the business. Each team member on the executive staff is assigned a responsibility and accountability to the fiscal health of the business. Visibility into the health of the business by way of dashboards with financial goals have been implemented and performance is measured against the results.
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Metrics:
After double-digit months of a double-digit percentage to income loss, the client with the oversight of Cathcap has turned the profitability of the business from a loss to a 9% gain early in the recovery cycle.
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Conclusion:
By knowing the exact position of their financial health through visibility, the client is able to pitch their future forward with certainty.
“I have probably only had one other vendor take as much initiative as Cathcap”
John Berry
Berry Law Firm
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