Financial management is concerned with all aspects of a business’ financial decisions which directly affect the business' overall performance including the long-term raising of finance and the allocation and control of resources with the aim of maximising shareholder(owner) return.
PK Mwangi Global Consulting works with small and medium-sized enterprises (SMEs) and corporate clients on key financial aspects of their businesses. These include assessing their financial performance and advising on key finance issues ranging from the management of inventory, accounts receivable and payable to cash management and funding strategies. In considering our clients’ long-term plans we help them identify and implement their projects ensuring an optimal return to their long-term financial objectives.
Using our proprietary model that captures the client’s positioning in the market and ascertaining a score to this we are able to model, through risk-simulation and appropriate performance criteria, the future economic performance of both established and start-up firms. This is key for them in accessing competitive financing from both equity investors and commercial lenders. This multi-tier application model also allows us to cater for a range of other client needs.
PK Mwangi Global Consulting thrives on its versatility as a closely-knit firm able to combine flexibility of approach with a value-for-money service well within the budgets of small and medium-sized firms while meeting the more complex demands of larger corporate clients.
We perform day-to-day book-keeping services outsourced to us by clients thereby significantly reducing their administrative burden, IT and finance staff costs and allowing them to concentrate on their core business. We work to understand the dynamics of the client’s organisation and provide management with quality and accurate information vital to the running of their business. We help the client prepare an internal financial procedures manual based on best practice and the systems to be adopted.
With a view to offering a flexible cost-effective service we identify what information the client needs and design their book-keeping around these needs.
We employ thoughtful and rigorous analyses to enable us offer valuable information to our clients providing management with forecast preparation techniques and tools to assist them in their decision-making. We use driver-based “what-if ” modeling to extrapolate the business impacts of financial, operational or capital projects for our clients. At any point in time, current forecasts/budgets linked to operational and marketplace realities should represent the single best version of future expectations that can help guide business decision-making. A detailed budget process then provides valuable insight into the inner workings of the client’s business.
We perform tailored business review services either for the business itself or for external stakeholders to ensure that these understand the reasons for underperformance or to attest to reported performance. This independent assessment helps clients get a clearer picture of business performance and explore available options.
We provide an objective, frank and clear assessment of the client business, its marketplace, competitive strengths, together with a “road map” for the future thereby revealing hidden potential and opportunities. This enables the client make the most of available resources while offering a new perspective to the business.
We analyse the client firm’s market position, asset base, financial performance and growth projections and apply financial models. We, further, integrate finance and economic expertise to arrive at a valuation process that provides critical insight into the client’s underlying value drivers. The process is robust ensuring that relevant market data and intricate valuation techniques are used making the business valuation defensible.
We compile and maintain client financial records based on International Financial Reporting Standards (IFRSs) or local Generally Accepted Accounting Principles (GAAPs) including completing accounts disclosure notes, providing technical accounting advice and liaising with external auditors.
Local GAAP conversion to IFRS requires an in-depth technical understanding of the accounting differences between the different standards as well as their interpretations and potential approaches. We assist clients to make this conversion allowing a smooth transition to IFRS.
We advise clients on the identification of cost drivers and associated apportionment metrics as well as provide analysis of cost behavior while facilitating the development of operational models to simulate the impact of activity growth or reduction. This is critical in supporting them develop a pricing strategy that enhances their competitive positioning. Further we assist clients improve their budgeting process and develop an efficient variance analysis framework to enable them effectively track and review the causes of variances to budget.
Our proprietary model helps identify and zero in on aspects of the firm that destroy value and lead to unmanageable debt and the threat of business closure. We then advise the client on how the business can be turned around to deliver profit, maintain optimal levels of debt and manage key stakeholder commitments.
We further identify unprofitable units of the business allowing management to make informed decisions regarding their divestment strategies. We assist the client actively manage the liabilities side of the balance sheet hence removing pressure on their margins as well as monitoring specific financial relations with their lenders.
We endeavor to check all assumptions- strategic, operational, financial and commercial, involved in a financing deal providing peace of mind to both investor and/or commercial lender through an analysis and validation of the said. Using a proprietary risk model we ensure that client or third party projections of revenue and future cash flows are robust and that the assessment of market conditions and client positioning is adequate. Our work will involve inquiries and discussions with management, a review of the accounts and other documents as well as analytical procedures applied to data provided. We also review historical earnings and establish key profit drivers to determine the long- term sustainability of the subject business.
We work with client management to provide independent advice and support in developing and optimizing client business finance operations in order to meet the ever-changing realities of their business environment. We leverage our entire resource-base to develop solutions for the client with the aim of integrating the finance function into the broader strategic process. We assist the client manage all aspects of their financial commitments s to ensure the smooth running of their business while helping with either specific issues or streamlining their processes. Our involvement includes that in reporting of information to clearly identify financial issues, providing in- depth budget management and improving forecasting.
Hedging reduces a firm’s exposure to operational risk and helps sustain profitability. We assist clients understand and analyse the operations and structure of the markets in which derivatives and structured products are traded, the valuation of financial instruments and how they can use derivatives and structured products to manage risk or enhance their treasury operations. We perform analyses of clients’ derivatives and structured finance activities involving hedging effectiveness, economic substance, credit and interest-rate market involvement, foreign exchange transactions and equities as well as produce local GAAP/IFRS-compliant hedge accounting reports.
Investing in new equipment, products, projects or businesses involves substantial capital outlay. It is, therefore, crucial that businesses employ an effective screening of investment proposals. We offer a comprehensive and independent approach to this appraisal, minimizing risk and bias while outlining the underlying assumptions and their potential impact. By creating awareness by the client of return on capital matters while interpreting their project data and financial outputs we enable them deliver projects which have been subject to a business case. This, coupled to our detailed knowledge of the market, allows us to assist clients and lenders in shaping transactions that enable capital projects to succeed.
We ensure sufficient and accurate information is available to monitor cashflow as well as review end-to-end processes (from receiving orders, through completion of work, invoicing and receiving cash) to ensure working capital optimization is achieved. Changes in working capital cycles (customers, suppliers and inventory) brought about by industry-specific realities mean that many approaches to optimizing working capital do not sufficiently address core process chains in their entirety. We make sure that entire core process chains are considered in the optimisation strategy including the adoption of an approach that facilitates cross-divisional coordination.
The allocation of capital in SMEs is as important as it is in large corporations.
However, given their lack of access to capital markets, capital budgeting is of even more importance to SMEs
because the funds necessary to correct investment mistakes may not be available. However, very few do
a good job of it.
Following the application of initial screening techniques as the NPV or the discounted payback period, many projects are discarded at this initial appraisal stage for lack of a business case. This may, however, be premature.
Strategic planning gives organisations direction allowing managers to take a more long-term view and stimulating them to prepare for or even create the future. Strong financial performance is the product of such strategies.
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When implementing its strategic plans, the MNC has the option to either borrow locally in the home market or borrow internationally in the export market. However, vagaries in economic conditions or changes in government policies in either the home market or export market will impact valuations of either the home currency or the export market currency or both.
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