1. THE FINANCE DEPARTMENT
Organizing your Finances
Presented to:
Artemis Ventures Portfolio Group
By:
Bud Austin and Charlie Rodondi
Kranz & Associates, LLC

2. Key Issues for a Start-up
Hire Your Interim CFO
Determine Department Structure
Set up a Chart of Accounts
Purchase General Ledger Software
Quick Books
Peachtree
Develop a Cash Management Program
Establish Key Vendor Relationships
Develop a Financial Plan
Planning and Budgeting

3. Key Issues for a Start-up
Establish Consistent Reporting Formats
Establish Filing System
Establish Policies and Procedures
Establish Employee Benefits Program
Establish Stock Management Program
Establish Contract Management Program
Establish Revenue Recognition Plan

4. Hire Your Interim CFO Why Hire a CFO Experience Contacts
Obtain a Known Quantity
Team Player
Strategic Contributor
Interview Several Options
Individual Referrals
Organizations
Kranz & Associates
The Brenner Group
David Powell Group

5. Hire Your Interim CFO Check References Prior CEO’s Venture Partners
Industry Experts

6. Determine Department Structure
Development
Marketing
Business Development
Sales
G & A

7. Set-up Chart of Accounts
Establish a Numerical Chart with Department and Standard Account Structure
First Two Digits = Department Number
Last Four Digits = Account Number

8. Purchase Accounting Software
Key Features
Low Cost
Ease of Use
Requires Disciplines for Cash Management, Revenue and Expense Management
Reporting Structure
Analytical Ability
Ease of Conversion to Future Software Package

9. Cash Management System
Invest Excess Cash to Generate Income
Cash Reserves Account
Three to Six Months of Liquidity
Money Market Account
Investment Brokers
Smith Barney
Morgan Stanley Dean Witter

10. Cash Management System
Establish Authorization Matrix
Two Signatures over $10,000
Establish Authorization Levels
Managers = $ 1,000
Directors = $5,000
VP’s = $10,000
CEO = > $10,000

11. Cash Management System
Paper Documentation for All Activities
Vendor Quote Sheet
Approved Internal Purchase Request
Approved Purchase Order

12. Establish Key Vendor Relationships
Banks
Lease Lines
Insurance
Payroll Service
CPA Firm
Big Five
Other Firms
Investment Broker

13. Develop Financial Reporting
Design Reports for Various Users
Board Of Directors
Executive Staff
Department Management
Others

14. Planning and Budgeting
Define Goals and Objectives
Corporate
Department
Bottoms-up Budget
Start with Department Level Salaries and Build Up
Roll Up:
Balance Sheet
Income Statement
Cash Flow Statement
Headcount
Waterfall
Capital Expenditures
Obtain Board Approval

15. Establish Consistent Financial Reporting Package
Monthly and Quarterly Reporting
Balance Sheet
Income Statement
Cash Flow Statement
Waterfall Report
Actual vs. Budget Variance

16. Set-up Filing Requirements
Personnel Folders
Personnel Files
Corporate
Accounting

17. Establish Policies and Procedures
Disbursements
Travel & Entertainment
Capitalization
Hiring Practices
Purchasing
Option Management

18. Establish Employee Benefits Program
Salary Structure
Vacation and Sick Policy
Medical, Dental, and Vision Plans
401K Plan
Flexible Spending - Sec.125 Cafeteria Plan

19. Establish a Stock Management Plan
Set a Budget
Set-up a Policy for Issuance, Exercise, and Repurchase
Set-up “Cap Table” and Reporting Formats
Obtain Board Approval

20. Set-up Contract Management Process
NDA’s
Development
Consulting – Draft Standard Agreement
Customer
Vendor

21. Establish a Revenue Plan
Sales Acceptance Policy
Sales Order Processing
Credit Limits
Revenue Recognition
Statement of Position 97-2
Staff Accounting Bulletin No. 101

22. Executive Summary Organize Early Outsource Your Finance Department
Manage Your Cash
Be Successful