Vantis, a UK accounting, tax and business recovery and advisory group, has launched a cash management service for the legal sector.
No law firm wants to call in an insolvency practitioner; many firms are, however, increasingly experiencing difficulties with their cash flow. In the recent Vantis Market inSight survey – a national survey of owner managed business – cash flow was the number one priority for all firms. If a firm is having cash management difficulties, it is typically not because the underlying business is faulty, or even that the finance function is inherently wrong, but sometimes there are not enough parts being done correctly.
Andrew Cranmer, head of cash management and stabilisation at Vantis, a UK accounting, tax and business recovery and advisory group, said: “At many firms the finance function isn’t used to dealing with cash flow difficulties. More firms fall over because of cash flow trouble than anything else. We want to help businesses find their feet again before it gets to the stage where they need to call in an insolvency practitioner.
“There is a lot of talk in the legal market of an increase in hiring, with firms often thinking that if they bring on new big hitters the revenue will follow. This is not always the case, or at least not straight away. There therefore needs to be a recognition, reflected in the forecast, that in the first few months after joining, new starters can be a big drain on cash resources,” he added.
Vantis’ cash management and stabilisation service is comprised of:
- Hands on cash control and payment.
- Prioritising working capital management.
- Short- to medium-term forecasting.
- Improvements to management information.
- Financial stabilisation.
Cranmer concluded: “Getting control over cash and short term cash requirements underpin the stabilisation of the business. This buys valuable time to assess options and is key to preventing the situation deteriorating while a solution is found.”
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