DUB: Good afternoon, Mr. Latsch, good afternoon, Mr. Manegold. I’d like to warmly welcome you to this interview.
IMB: Good afternoon.
DUB: You recently launched your “Digital CFO Service.” What exactly is this service?
Daniel Manegold: Our “Digital CFO Service” is an additional service that enables our clients to optimize their internal finance functions. As part of this, we implement database-driven planning and controlling software. In addition, we help our clients identify the right software solution and support them as a partner throughout the setup and successful implementation.
DUB: What target audience is your service tailored to?
Andreas Latsch: The “Digital CFO Service” offers benefits for both small and medium-sized businesses as well as growth-oriented companies. Our experience shows that our planning tool leads to increased efficiency in the areas of controlling and accounting. At the same time, it enhances transparency in reporting. This provides our clients with a solid data foundation regarding their current financial situation, taking future events into account.
Daniel Manegold: A solid data foundation plays a crucial role, particularly in the context of corporate transactions and business succession. An essential component in these areas is the valuation of the company. Depending on the methods used, either historical or future data is relevant—data that is available through our “Digital CFO Service” and can be presented on a daily basis.
DUB: The connection between your “Digital CFO Service” and the areas of corporate transactions and business succession sounds very interesting. Could you go into a bit more detail here and outline the specific benefits for your clients?
Andreas Latsch: As already mentioned, data quality plays a decisive role in determining enterprise value. As part of our “Digital CFO Service,” we conduct an in-depth analysis of the current accounting records and existing structures. These form the basis for capturing the actual historical data from the past. In addition, we work with our clients to look toward the future and prepare a projected financial statement based on the actual figures, taking into account operational metrics and current market trends. Through this comprehensive transparency in reporting, we create a solid data foundation that enables us to apply a variety of valuation methods. In this way, we ensure a well-founded and precise valuation for our clients. The advantage in the context of a transaction is that the buyer also gains a very clear understanding of how the company’s value was derived, thanks to the depth and clarity of the data. This builds trust!
Daniel Manegold: Our “Digital CFO Service” offers significant advantages, particularly in rapidly changing business environments. By using company data updated daily, we are able to incorporate current events into the determination of enterprise value. This capability enables efficient monitoring and continuous updating of the company valuation in real time. Our clients can thus make precise decisions, whether regarding investments, corporate strategies, or even corporate transactions. In this way, they ensure the continuous strengthening of their competitiveness and remain agile in a rapidly evolving market environment. Our “Digital CFO Service” is therefore a valuable tool for ensuring the success and realization of our clients’ individual interests.
DUB: You’ve now described many of the benefits of your service. But what specific tasks do you handle as part of your “Digital CFO Service”?
Andreas Latsch: A project in this area begins with a parallel process that focuses on analyzing the existing accounting system, the structures in use, and—in particular—the key success factors for the company. In this way, we create an interface with the company’s internal database systems and have the opportunity, if necessary, to completely reorganize them and integrate them into the “Digital CFO Service.”
Daniel Manegold: It’s important to emphasize that we simultaneously develop an integrated corporate planning framework. This framework is characterized by its ability to translate the specific characteristics of our clients’ business models into quantifiable figures. We begin by creating partial plans and setting up an interface to our database-driven planning software. This allows us to transfer the financial data into our software solution and link the planned figures with the actual figures. This forms the basis for generating daily updated analyses, forecasts, or valuations.
Andreas Latsch: It is of fundamental importance to perform a projection through the end of the fiscal year at the levels of operating income, the balance sheet, and, in particular, liquidity. In addition to the ability to perform daily valuations, a well-founded overview of the development of available cash is extremely important in order to be able to contact investors in a timely manner, if necessary, or to organize alternative financing instruments. This projection enables a company to forecast its financial position and performance at year-end and thus make informed decisions. It allows for an assessment of the company’s financial health as well as the planning of strategic measures, for example, in the context of a corporate transaction. Furthermore, it helps monitor financial stability and identify bottlenecks early on so that appropriate precautions can be taken.
Daniel Manegold: To make all this information available to our clients, we provide a link to a business intelligence system. This gives the client access to the complete reporting system at any time and from anywhere. In regular in-person review meetings, we discuss the results achieved and any potential need for action. Business performance data is imported, analyzed, and discussed on a monthly basis. This allows us to ensure that our clients are always up to date.
DUB: On January 1, 2021, a law went into effect that further increases the importance of a controlling system for small and medium-sized businesses. Could you briefly elaborate on this aspect?
Andreas Latsch: Yes, that’s correct. Since then, the Act on Stabilization and Restructuring Measures for Companies (StaRUG) has been in effect in Germany. Under this law, managing directors of legal entities are required to monitor developments that could jeopardize the company’s continued existence. To this end, they must establish an early crisis detection system that continuously assesses the company’s solvency.
Daniel Manegold: A company’s liquidity planning for a 24-month period is particularly crucial. If no such early crisis detection system is in place, the insolvency administrator is obligated—in the event of a failed restructuring—to examine and assert creditors’ liability claims against the managing director. This is precisely where our “Digital CFO Service” comes into play, as our integrated financial planning covers exactly this required aspect. Thus, with our solution, small and medium-sized enterprises have access to a comprehensive early-warning system for risk detection that, as just discussed, is required by law. Consequently, our clients get everything from a single source—clear solutions that are available quickly.
DUB: Thank you very much for your explanations regarding the “Digital CFO Service.” I appreciate this insightful conversation and wish you a pleasant day.
