Some companies take what feels like an eternity to prepare their annual financial statements. Other companies have prepared their annual financial statements one month after the balance sheet date – often also certified by the auditor. The “fast close”, i.e., the rapid preparation and – if necessary – the audit of the annual financial statements, provides stakeholders with timely information on the company’s assets, financial and earnings situation. Whether banks, suppliers, or management – up-to-date reporting is a competitive advantage and thus a real SME issue. How do you achieve high speed for your annual financial statement?
Posts
“Organizations do not commit violations of the law or misconduct. These are committed by people in the organizations.”
Compliance combines goals and functions to comply with laws and rules in the company and to create the framework that misconduct is avoided. In practice, compliance looks different for every company: Of course, every company has to adhere to the legal provisions, thus acts “compliantly” per se. But for a craft business, other laws and internal rules are important than for an IT company or a logistics company. All internal rules that go beyond the law are formed from industry practices, stakeholder expectations and corporate values.
THE MAK’ED TEAM combines its SME expertise with teaching
In the North Baden region, two strong partners with a clear focus on medium-sized businesses have come together. At the beginning of the month, we sealed our cooperation with the University of Applied Sciences for Management (HdWM) in Mannheim.
This means that teaching is now even more closely linked to practice – for more competence for SMEs. We are convinced of the efficiency of small and medium-sized enterprises and would like to help shape this efficiency by empowering young people.
“Will the company continue? What do you mean? Yes, what else?”
This is a typical reaction of many managing directors when they are asked about the problem of whether a running business is to be assumed in a valuation of the company. The reason for this question may be overindebtedness or payment problems. In this case, the regulations of insolvency law give reason to assume that the company (GmbH, AG, GmbH & Co. KG) can no longer be continued. Therefore, in this situation, the management responsible for preparing the annual financial statements should not rely on the fact that it can continue to prepare the balance sheet at going concern values. It must first be ensured that the going concern premise is met, i.e., that it can be assumed in the evaluation of the company’s activities that it can be continued.
It’s the combination that makes the difference! Different skills, practical knowledge and solid expertise are the basis of our business. As diverse as our team is, our common basis is our affinity for medium-sized businesses and for the people who shape them.
Our Consulting Partner Karin Scherer
“If you want to know something, ask an experienced person and not a scientist” – Chinese wisdom
What was previously very good for SMEs, but not mandatory, is becoming a “must have”: CSR reporting is moving into the SME sector and will be given a permanent place in the management report as of 1 January 2024. This puts non-financial, i.e. sustainable reporting, on the same pedestal as financial reporting.
The EU Commission’s planned changes to the extended reporting obligation are not surprising; after all, the sustainable contribution of all companies plays an important role in Europe’s sustainability transformation. Here, reporting is the toolbox to ensure the implementation of these sustainable economic measures.
The topic of sustainability is gaining strength. The background is the EU Green Deal, with which the European states want to gradually make the EU climate-neutral by 2050. The financial markets have a decisive role to play in the implementation of the climate policy goals, as they promote and anchor the issue of sustainability. “Sustainable finance” is the new buzzword. It means that sustainable aspects of a company regarding the environment, social issues or corporate governance are included in the decisions of financial actors. Sustainable finance is synonymous with supervision and regulation of the financial markets towards more sustainability in companies – and that also in small and medium-sized enterprises. In the future, banks will give more weight to sustainable aspects when granting loans, regardless of the size of the company, and make sure that their loan portfolios are in line with the EU taxonomy, which will come into force in 2022 and place greater emphasis on environmental aspects.
The decision to bring an external managing director into your own company requires a change in the owner’s leadership behavior.
In one of our client’ companies, this decision was made some time ago – with the best of intentions and a disastrous outcome!
The owner of a medium-sized company hired a managing director for a new subsidiary for the first time and renounced the usual board position himself. He had decided to do so for a variety of reasons and postulated that competence and responsibility were inseparable. The newcomer could and must manage his area of responsibility independently.
This sounded interesting to the “new guy”. He had gained second-tier experience with a larger competitor and now wanted to have overall responsibility.
The implementation of the EU Whistleblower Directive is on the agenda of many small and medium-sized companies. Managing directors and compliance officers immediately think of lawyers and software, but it takes a lot more to implement the guideline not only in a legally secure way, but also in a motivating and profitable way.
Our expert Karin Scherer puts it in a nutshell: “Many managing directors would like to receive information from the staff when the company is damaged, whether negligently or intentionally, internally by employees or by external persons. Our experiences range from reaching into the till, theft of goods to sexual harassment at the workplace. All incidents in which those in the know or affected did not know how to act, looked a way as a precaution – and in which the management would have liked to have been informed at an early stage, to protect the employees affected and the company.”
Most small and medium-sized companies feel it clearly: the necessary employees are harder to find than ever before! In certain sectors or regions, the shortage of skilled workers has been painfully noticeable for some time, but finding and retaining well-qualified candidates is now a real art. It is not the employer, but the potential employee who holds the scepter. This paradigm shift in the labor market is one of the great changes of our time. Consequently, so-called employer branding, i.e. the development of an attractive employer brand and its marketing to the outside world, is increasingly coming into focus. No matter what size company and what budget it has available: If it wants to secure its own future, it must adapt to the requirements of potential employees with suitable marketing and recruiting strategies.
