
HOW CAN WE HELP YOU TODAY?
HERE ARE SOME FREQUENTLY ASKED QUESTIONS ABOUT FUSION SOLUTIONS
WHAT IS THE DIFFERENCE BETWEEN A BUDGET AND A FORECAST?
A budget is a plan or set of goals that you want to achieve in a certain period. This plan is developed and set to be in line with your strategic financial plan. A budget, once set, is typically static.
A forecast is an estimate of what you will actually achieve. Forecasts are developed using historical and current financial data along with industry and market information. Forecasts are updated regularly to reflect actual performance and updated estimates.
WHAT ARE THE BENEFITS OF AN ACCRUAL BASIS OF ACCOUNTING VS. CASH BASIS?
Three key benefits to using the accrual basis of accounting are:
Understand the True Financial Picture: Accrual accounting allows you to understand the true financial picture including profitability, where the profit is coming from, and where expenses are going.
Plan for Growth: Cash accounting is after the fact while accrual accounting is in real-time. You do not have to wait to receive the cash to see what your profits are. Because of this, you can more easily plan for growth and strategize ways to improve sales or generate more revenue as you analyze the financial results.
Obtain Financing: The accrual basis of accounting follows U.S. Generally Accepted Accounting Principles (US GAAP). Being US GAAP compliant means that you have implemented standard accounting practices which allows your financial picture to be easily assessed by investors and financial institutions.
WHAT IS PERFORMANCE TRACKING?
Performance tracking involves developing a set of Key Performance Indicators (KPIs) which are quantifiable measurements that can be used to gauge performance over time. These measurements provide a focus for strategic financial and operational improvement. KPIs help to highlight strengths and weaknesses, pinpoint success drivers, and provide insight into how you are performing in relation to your goals and objectives as well as compared with your peers.
WHAT IS AN ACCOUNTING POLICIES & PROCEDURES MANUAL?
An accounting policies and procedures manual documents your accounting policies in accordance with US GAAP (as disclosed in your financial statements), accounting processes including the roles and responsibilities of individuals involved, and key internal controls in place to maintain segregation of duties.
HOW DO I PREPARE FOR THE DILIGENCE PROCESS?
Due diligence involves an examination of financial records before entering into a proposed transaction with another party. Leveraging our financial, audit, and industry expertise, Fusion Solutions will make sure you are prepared for the diligence process. Fusion Solutions will review your financial records, provide feedback, and perform the necessary remediation so you are well positioned for a smooth and efficient diligence process.
MORE QUESTIONS?
Contact us with any questions or schedule a meeting so we can chat specifically about your business needs!
WHY IS REGULAR FINANCIAL REPORTING IMPORTANT?
Accurate and timely financial reporting is important for many reasons including analyzing financial results against the targets you set to achieve your financial goals and objectives.
Many start-ups and small businesses set up their books to record transactions on a cash basis of accounting. For businesses experiencing growth, it is important to record transactions on an accrual basis of accounting. The accrual basis of accounting records revenues and expenses when they are incurred, regardless of when cash is exchanged.
WHAT IS A CASH FLOW FORECAST AND HOW CAN IT HELP ME MANAGE CASH?
A cash flow forecast tracks the money coming in and out of your business and predicts how much money will be available to your business in the future to cover operating expenditures, debt service, and known nonrecurring expenses.
Maintaining your books on the accrual basis of accounting, the revenue and expenses are recorded when incurred but the timing of the related cash inflows and outflows is often different. Payments from credit sales can lag 30 to 90 days after the sales are recorded. A cash flow forecast will capture this lag time so you can plan to have cash on hand to cover the delay and hold any expenses (within terms) to adequately manage cash.
Cash flow forecasting also helps to secure a loan or line of credit. When the need arises to seek out a loan or line of credit, a cash flow forecast will demonstrate your need for the loan and show your ability to service the debt.
WHAT IS THE CHART OF ACCOUNTS?
The chart of accounts is the index of all accounts available in the general ledger. It is the tool that helps you organize and categorize your transactions and is the foundation for your financial reporting. Being thoughtful in how you set up your chart of accounts will make it easier for you to record transactions in accordance with US GAAP and any relevant industry standards. More importantly, having a well set up chart of accounts will provide the accuracy and level of detail you need to garner relevant insights from your financial reporting.
WHAT IS THE DIFFERENCE BETWEEN A FINANCIAL STATEMENT AUDIT AND REVIEW?
A financial statement audit provides the highest level of assurance that the financial statements are not materially misstated. A financial statement audit involves an in depth understanding of your organization, its control environment, and detailed testing of transactions.
A financial statement review is less in scope than an audit and provides a lower level of assurance that the financial statements are not materially misstated. A financial statement review involves a general understanding of your organization, its operations, and inquiry and analytical procedures to understand the financial results.
HOW MUCH DO YOUR SERVICES COST?
We aim to be as transparent and straightforward with our pricing structures as possible.
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Our CFO Advisory Services are billed on a monthly retainer at the beginning of each month. The retainer amount is determined based on an agreed upon scope of work and corresponding budgeted number of hours.
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Our Consulting Services are billed semi-monthly on an hourly basis with a not to exceed threshold. The not to exceed threshold is determined based on an agreed upon scope of work and corresponding budgeted number of hours.
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Both pricing structures are set up to maximize your time and budget.
