Establish cash visibility
Introduced a 13-week cash-flow forecast that connected expected receipts, disbursements and borrowing requirements.
Selected work · 04
Working capital · Liquidity · CFO advisory
Restoring liquidity and control of an operating line
A practical cash-management program improved liquidity and restored control of the operating line.
The situation
What was at stake.
Accounts receivable were aging, bad-debt risk was increasing and management lacked reliable forward visibility into cash. Delayed invoicing and inconsistent credit practices compounded the pressure.
The bank had become concerned about management of the facility, making rapid improvement in both liquidity and financial discipline essential.
The work
A focused path from problem to outcome.
Strengthen credit management
Implemented consistent credit applications, granting and collection procedures and focused the team on higher-risk, higher-impact accounts.
Accelerate billing and collections
Standardized invoicing, resolved customer-portal problems and addressed the long-standing dispute that had caused a major customer to withhold payments.
Results
What changed.
+40%Available liquidity
−80%Bad debt
−12 daysCollection period
EliminatedOperating-line excesses
The company restored cash-flow visibility, improved the quality of its receivables portfolio, reduced borrowing costs and stopped exceeding the operating line.
Why this experience matters
Liquidity problems are often operational before they become financing problems.
A larger facility would not have corrected delayed invoicing, inconsistent credit practices or weak cash visibility. Addressing the operating causes improved liquidity, reduced pressure on the line and gave management better control of its borrowing needs.
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