#FinanceMaster on LinkedIn: #financemaster #financemaster (2024)

10 Growth KPIs (by Brian Feroldi).What gets measured gets managed.Here's a list of growth KPIs every company & investor should know:📈 Revenue Growth• Measures the increase in revenue over a specific period, typically expressed as a percentage.→ Formula: ((Current Revenue - Previous Revenue) / Previous Revenue) x 100💰 Monthly Recurring Revenue (MRR)• Tracks the predictable and recurring revenue generated.→ Formula: Average Revenue Per User x Number of Customers➗ Gross Margin •The percentage of revenue remaining after deducting the cost of goods sold.→ Formula: (Revenue - Cost of Goods Sold) / Revenue)×100👤 Customer Acquisition Cost (CAC)• Calculates how much it costs to acquire each new customer.→ Formula: Sales and Marketing Expense / Number of New Customers Acquired 💵 Customer Lifetime Value (CLV)• Assesses the total value a customer brings to the company throughout their lifetime.→ Formula: Average Purchase Value x Average Purchase Frequency × Average Customer Lifespan🤗 Customer Retention Rate (CRR)• The percentage of customers who continue to use your product or service over time.→ Formula: (Number of Customers at the End of the Period - Number of New Customers Acquired) / Number of Customers at the Start of the Period) x 100⤵️ Churn Rate• The rate at which customers stop using or subscribing to your product or service.→ Formula: (Number of Customers at the Start of the Period - Number of Customers at the End of the Period) / Number of Customers at the Start of the Period😀 Customer Satisfaction Score (CSAT)• The level of satisfaction that customers have with a company's product, service, or overall experience.→ Formula: (Number of Satisfied Responses / Total Responses) × 100💬 Net Promoter Score (NPS)• Measures how likely customers are to recommend a company's product or service to others.→ Formula: (% of Promoters) - (% of Detractors)📊 Market Share• A company's portion of the total market in terms of revenue.→ Formula: (Your Company's Sales / Total Market Sales) × 100Which growth metrics do you value most?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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The 99% CFO is dead!Long live the 80/20 CFO.Here’s what it means…Understanding the past is a given.Predicting the future is what’s in demand.We can never be accurate about the future.That’s why long-winded processes to get to a forecast or prediction are no longer fit for purpose.Better with a quick estimate of what we think will happen and make a decision.This 80/20 approach is exactly the mindset CFOs should adopt if they want to be successful.we love this conversation about how to be an 80/20 CFO and we know you’ll get many practical tips from it as well.Which is your favorite snippet?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here: https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere: https://lnkd.in/eC_zuCU4

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Accounting to Reporting (by Abdul Khaliq).Your journey from accounting to reporting does not start with transactions.It starts with designing a Chart of Accounts that is fit for purpose, not for existing needs, but that caters to the growth of your organization.Once you have designed your CoA in a certain way, redesigning it may take much work.Transactions are the second most crucial element of your entire accounting system. Your reporting will depend on the level of accuracy of your transactions.The third thing you want to focus on is mapping your trial balance and the medium you use for consolidation and reporting—any tool you have, whether Excel or some other software, can be used.I have designed the process keeping all of this in mind. What do you think?Please keep this in consideration when you design your processes:𝗖𝗛𝗔𝗥𝗧 𝗢𝗙 𝗔𝗖𝗖𝗢𝗨𝗡𝗧 (𝗖𝗢𝗔) A well-structured Chart of Accounts (COA) is the backbone of an organization's financial management and reporting.When designing a CoA, keep this in mind:• Scalability and GrowthA thoughtfully designed COA can accommodate future growth seamlessly. • Financial Analysis and ReportingA comprehensive COA allows for the customization of reports to meet these evolving demands, whether for internal management or external stakeholders.𝗧𝗥𝗔𝗡𝗦𝗔𝗖𝗧𝗜𝗢𝗡𝗦 Transactions are nothing but an accumulation of:• Accuracy• Reliability• Controls• Attention to Details• Adherence to Policies & Procedures and Delegation of Authority𝗧𝗥𝗜𝗔𝗟 𝗕𝗔𝗟𝗔𝗡𝗖𝗘 The Trial Balance is not your P&L or your Balance Sheet. It is a consolidated position of all transactions based on the Chart of Accounts totaling zero. However, its accuracy is crucial for your consolidation and reporting.𝗠𝗔𝗣𝗣𝗜𝗡𝗚 The accuracy of the mapping between the ERP system and the consolidation tool is the key. When mapping, ask yourself:• How and what do you want to see as an output, i.e., management or financial reporting?𝗥𝗘𝗣𝗢𝗥𝗧𝗜𝗡𝗚Now, the quality of your reports depends on the consolidation and reporting tool you use or how brilliant you are in designing your Excel models.----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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If we had a dollar for every accountant we've met who couldn't do a proper debit/credit posting we'd be rich!Most finance and accounting professionals don't learn accounting at school.They only learn when they enter a real job and they're with the practicalities.That means drawing T accounts and getting things to reconcile.It's fair to say most of this is automated today but if you lose touch with how the numbers are produced you'll be heavily challenged when stakeholders question them.Hence, it's sound praxis to understand and be able to do debit/credit postings yourself.The challenge is you don't get many chances to practice in today's finance function.Help is here though in the form of this accounting cheat sheet from John Gillingham, CPA.Never again do you need to suffer the embarrassment of doing a faulty posting or not being able to explain how the numbers came to be.How did you learn debit and credit... for real?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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Learn to manage cash like Oana Labes, MBA, CPA...Here's why:To seize growth opportunitiesTo protect against critical business risksTo avoid financial distress and loss of business valueTo maximize shareholder value and return on investment.👉 Let me know in the comments, how do you forecast cash flow. 🎯 If you’d like a full-resolution PDF copy, please help me spread this free resource.➡️➡️➡️ Like, Comment, Share with your network. Then download it here: https://lnkd.in/eYRG-QnG➡️➡️ And make sure you follow me so you don’t miss out on the next one!🎯 Cash comes into a business from 3 main sources:>> Operations>> Investments>> Financing🎯 Cash 1.0 is optimizing AR, AP, and Inventory terms and turnover 🎯 Cash 2.0 is working on:>> Cash Flow Forecasting Techniques>> Effective Debt Management>> Capital Expenditure (CapEx) Cash Flow Optimization🎯 Here are 4 critical reasons to remember for managing cash:1️⃣ Seize Growth Opportunities:⚫ you need agility to capitalize on acquisitions, expansions, or innovation ⚫ cash reserves may not be sufficient, so having a strategy to attract the incremental cash you need will allow you to take quick action on opportunities and give you a competitive edge.2️⃣ Protect Against Critical Business Risks:⚫ cash acts as a financial buffer against economic downturns, demand fluctuations, or supply chain issues⚫ taking steps to ensure sufficient excess cash will help ensure your operational stability and strategic focus during unforeseen challenges3️⃣ Avoid Financial Distress and Loss of Business Value:⚫ effective cash management will prevent cash flow shortfalls, which are a leading cause of business failure.⚫ the worst time to get other people's money (bank, investors) is when you need it⚫ planning ahead will help you meet short-term liabilities (payroll, suppliers, debts) and avoid eroding business value and reputation.4️⃣ Maximize Shareholder Value and Return on Investment:⚫ strategic investments and operational decisions that drive long-term growth and profitability require advanced cash flow planning⚫ managing cash effectively will always position companies favorably to generate and provide superior returns to shareholdersWhat would you add?PS. What was your favorite part?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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What's the fastest way for finance professionals to become more impactful?Say it with visuals and here's why...Most people outside Finance don't think in numbers. They think in visuals.Most finance professionals know this, however, it doesn't translate into their management reports.They're still cluttered with numbers.Even if they use visuals they're then cluttered with visuals.It just doesn't facilitate a good discussion.Try this structure instead:1️⃣ Start with the WHAT i.e., your answer2️⃣ Explain the WHY i.e., the reasoning for your answer3️⃣ Move on to the HOW i.e., the next steps4️⃣ Have only ONE key message per slide5️⃣ Use only ONE visual per slideAnd please choose the right visuals!Here are ten useful ways to visualize your data compliments of Sisense.Comment below "please review my management reporting" to get a free review and feedback for improvement (or send me a message).What does your management report look like?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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Learn 9 Ways to Forecast by Josh Aharonoff, CPA 👇Each time I build a forecast for a client, I work on first getting to know their business.I ask questions like…❔ How do you make money?❔ What are your plans for growth?❔ What is currently happening with your business?From there, I start to formulate a rough idea for how we’re going to build our forecast…but each section of the Profit & Loss and Balance Sheet may require a different approach.While they all differ, almost all forecasts I build include one / all of these 9 methods:1️⃣ 6 mo. historical average 🤔 How it works → take the last 6 months value. Can take it one step further by adding a buffer (like a 5% increase)💡 Why it’s useful → The future often times blends well with the past, especially in the first few months of projections2️⃣ Prior mo. balance🤔 How it works → Set your projection to last month's value💡 Why it’s useful → extra helpful when forecasting the balance sheet for accounts with minimal movements3️⃣ % of revenue🤔 How it works → Set your projection to take a % of revenue💡 Why it’s useful → As revenue scales, expenses tend to scale as well4️⃣ $ per hire🤔 How it works → Set a $ figure for each hireWhy it’s useful → Expenses / capex often times scale with each new hire5️⃣ Fixed Assumption🤔 How it works → enter any values or schedules you have on hand💡 Why it’s useful → for items like insurance or rent where you have a fixed schedule, you can plug them right into your forecast6️⃣ YoY Growth🤔 How it works → take the value from 12 months prior and add a growth factor💡 Why it’s useful → for companies with seasonality, you can match the schedule from the prior year, and add a buffer if need be7️⃣ Annual inputs🤔 How it works → Enter in assumptions for the entire year, then divide by 12 for monthly projections💡 Why it’s useful → simple and quick way to forecast for an entire year8️⃣ Departmental Intake🤔 How it works → sit down with each department head, and come up with a bottoms-up budget for their department💡 Why it’s useful → collect valuable information that you may not have insight into, hold each department head accountable to results & performance9️⃣ Zeroed out🤔 How it works → forecast 0 going forward💡 Why it’s useful → can be useful if you don’t expect any future values in this account, or if you project values in another account that relates to this account===So which is the right method?I typically start by making all Opex accounts other than headcount a 6-month average…and every balance sheet account other than cash + retained earnings equal to last month.Then I add more detail as necessary.What is your favorite method of forecasting?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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WE GIVE UP! We give in to your cravings to analyze stuff.And we also know you won’t analyze stuff anywhere but Excel.So let’s do it right, shall we?Here’s a guide to doing data analysis in Excel.Promise us something though, okay?Before you start analyzing stuff please get an idea about what you are looking for.Otherwise, you risk spending countless hours on nothing.What’s your favorite tool for doing data analysis?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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Free Finance Course (from Nicolas Boucher)+ Free CV Template+ 100 KPIsThis is for all you #financemaster(s) out there!Do you want to learn Finance?Nicolas has built a free finance course for you25 free lessons to make you more knowledgeable than 90% of the finance professionals.🙏 Help him spread this free course: like, share, and comment!1. Finance concepts made easy https://lnkd.in/eekwUknm2. How is Finance organized https://lnkd.in/gFkA388S3. Finance jobs https://lnkd.in/eqgvwEDv4. Finance career paths https://lnkd.in/esw4ubJF5. Career advice for Finance https://lnkd.in/eiUWNh9Y6. Finance CV Template https://lnkd.in/etKjH2Jg7. Accounting basics https://lnkd.in/eM4KNQZb8. Accounting principles https://lnkd.in/e_v7Uhas9. Understand Financial Statements https://lnkd.in/ebHpsbNZ & https://lnkd.in/eV2CF-7W10. Balance Sheet analysis https://lnkd.in/eVmB4zu311. EBITDA Explained to Kids https://lnkd.in/giYRFqby12. Balance Sheet vs Income Statement https://lnkd.in/g_9BzBjH13. Cash Flow Statement https://lnkd.in/ez-SQUb514. The 3 Cash Flow Activities https://lnkd.in/gUQ5HB6715. 9 levers to improve Cash Flow https://lnkd.in/gRYGbGBk16. 100 Finance KPIs https://lnkd.in/gMpsmPVi17. Budgeting https://lnkd.in/eU_WKvDt18. Standard costing https://lnkd.in/eR_rinsQ19. 10 Cost Reduction Tactics https://lnkd.in/gHUY6W2t20. CAPEX vs OPEX https://lnkd.in/eyANrk6Q21. Working capital management https://lnkd.in/eTtr_sRP22. CFO checklist https://lnkd.in/eYJTdhY723. Accounting checklist https://lnkd.in/eK5skhN624. The Finance Checklist https://lnkd.in/gzRiybr825. 100 Finance Answers https://lnkd.in/gNYH7_wD----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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Most finance professionals analyze stuff to death and fail to have an impact.Great financial analysts recognize that it's about more than data and analysis though...They focus on three things:1️⃣ Analytics2️⃣ Presentation3️⃣ Soft skillsSeems obvious right?Maybe it is but most finance professionals struggle with how to do it.They spend way too long analyzing the data.Their presentations are generally speaking a big mess.And they're oblivious to how to communicate their messages and influence decisions.CFI has put together a great extensive guide on how to become a great financial analyst......and we believe there's immense value for all finance professionals to dig into this content.What do you find is the best way to create impact with your analysis?----------Learn more about the latest trends in finance and accounting by listening to the FinanceMasterPodcast here:https://bit.ly/3NLSt73Or download guides and cheat sheets about finance and accountinghere:https://lnkd.in/eC_zuCU4

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