finance
TL;DR * The best board meetings allocate less than fifteen minutes to financial reporting and focus the rest of the time on three big strategic questions to effectively govern the future. * Most board reports fail by being either too detailed, such as 40-page decks, or too sparse, such as a
finance
TL;DR * A 2/10 net 30 discount program can provide an annualized return of 36 percent, which is better than most companies earn on invested capital, according to Craig Martin, Managing Director at Deloitte. * The annualized return on a 2 percent early payment discount over 20 days is approximately
finance
TL;DR * A company with a Days Sales Outstanding of 45 days on $10M annual revenue has $1.25M of receivables outstanding at any moment, which can increase to $1.5M if DSO creeps to 55 days. * Extending Days Payable Outstanding from 30 to 45 days on $8M of annual
finance
TL;DR * A rolling forecast should always look 12 months forward and incorporate the latest actuals to reflect reality and avoid managing against an outdated plan. * Most rolling forecast implementations fail because they update every line item every month, instead of focusing on the three to five key business drivers
finance
TL;DR * The average accounts payable clerk spends 40 percent of their week matching invoices to purchase orders and bank transactions, resulting in a significant waste of time and resources. * At a fully loaded cost of $70,000 per year, the average accounts payable clerk wastes $28,000 per year
finance
TL;DR * A $5M cash balance sitting in a non-interest-bearing account when 90-day T-bills are yielding 4.5 to 5.0 percent represents $225K to $250K in annual foregone yield. * Government money market funds investing in US Treasury securities have a risk profile that most corporate treasury policies can accommodate
finance
TL;DR * A company with a $200K per year AE who closes $2M in new ARR has a significantly different individual-rep contribution to CAC depending on whether fully-loaded comp, base only, or nothing is included for sales headcount. * The correct CAC formula includes all marketing spend, all sales headcount cost
finance
TL;DR * A growing number of finance teams have cut their close cycle from seven days to three, sometimes fewer, by automating the three most time-consuming phases: accounts payable reconciliation, variance analysis, and the final review checklist. * AI-powered tools like Tipalti, Bill.com, and Ramp can handle 80 to 90