Wednesday, 28 January 2015

Intervallum Limited featured in the Chamber of Commerce 'Weekly Update' on 'How an Interim Finance Director can add value to your business'

Intervallum is a provider of Interim Finance Director services, working at the sharp end of industry by acting as the FD on the clients own site, normally 5 days a week (although this is flexible and client led). One thing we are not is a recruitment agency for FDs. I have been providing these interim services for almost 11 years now, focussing on the SME environment (from start-up businesses to £300m turnover) and working anywhere in the UK as required. As principal of this business, I have a track record of working within Finance departments since 1983, a directly employed Finance Director since 1996, and in an interim capacity since the beginning of 2004. I am a Fellow of CIMA (and their West Midlands’ Chairman), the IOD's 25th Chartered Director, a Chartered Manager and have an MBA from Edinburgh Business School. As an Interim FD service provider. Intervallum offers fast and flexible solutions to our clients.

What exactly is an Interim Finance Director?
Many business people are not totally clear on exactly what an Interim Finance Director is, when you would need an Interim FD and how an Interim Finance Director can add value to your business. An Interim Finance Director is a highly experienced and qualified professional who would parachute in to your business to act as your FD, working through their own Limited Company and with PI insurance in place, to assist you at short notice with a number of issues (and be able to add value to your business almost immediately)

When would you need the services of an Interim FD?
This can vary from client to client, but the 3 main requirements are:-

1. A safe pair of hands - when a company's permanent FD resigns, he can often be gone within a month. The search and selection process, interviewing routines and successors notice period can on average, be a 5 to 9 m month period. An interim FD can quickly enter this company at the point of original resignation to spend almost a month with the outgoing FD to quickly understand his knowledge and experience of the business in order that projects can continue and that the valuable company knowledge from the original FD can be kept warm and the baton can be effectively handed over to the incoming permanent FD. In circumstances where the incumbent FD is removed at short notice, an Interim FD can pick things up from day one to ensure that there is no immediate danger to the business.

2. Turnaround situations and cash issues - as the credit crunch took hold, and the economy tanked, several businesses found themselves reducing in activity levels and strangulated by a lack of cash. Several Private Equity companies moved from potential outward investment to an inward look at their portfolio of businesses, as some of these came under pressure - which was exasperated by the debt funding that had to be serviced. Therefore I have been called into such businesses in a “dash for cash“ scenario to meet loan repayments, followed by a restructuring and cost cutting exercise (and in most cases a refocus on strategy) in order to turn the company around and allowing them to continue as a going concern.

3. The owners of the business want to sell their company and therefore need a financial professional to get their business in order, assist with the preparation of the sales memorandum, take the company through the due diligence process and then assist in the negotiations to achieve a satisfactory deal and take it to legal conclusion. In 2005 I sold a Telecoms business to Lord Young for £21m, and on 3rd April 2008 (just hours before Capital Gains Tax rule change) I helped a £200m t/o construction business to go through a £154m secondary buyout, assisting the 6 owner/directors to become multi-millionaires. In 2014 I led an Engineering business through a sizeable secondary MBO that created an Employee Benefit Trust in the post transaction company.

How can an Interim Finance Director add value to your business?
The fact that the company is maintained as a going concern after the extreme scenario of a turnaround means there is still value of some description for the business owners (and employees and creditors for that matter) as compared to a total wipe-out and liquidation. Successful negotiations with the crown by an interim can effect a time to pay arrangement and give valuable breathing space to get cash in. A good Interim FD will quickly get a grip on the cash management, effecting a daily cash report and forecast to highlight any future pinch points and navigate the business around the rocks.

Once the position is stabilised, the financial process and systems will be reviewed and “best in sector“ solutions will be applied i.e. to ensure the most efficient collection of cash. Weekly flash reports will be quickly introduced in order that the senior management team have a view of the 5 or 6 key performance indicators (KPIs) that allow them to see if their actions are having a positive or negative affect (without having to wait several weeks for a set of Management Accounts to be produced). A graphical dashboard will accompany the monthly reporting in order that non-Finance professionals in the senior team can quickly see the trends across the various parts of the business and allow incisive decisions to be made. During this time, the strategy of the business will be reviewed and refined to ensure a successful course is plotted and executed.

In a sale situation, an experienced Interim FD can quickly prepare the necessary financial reports to support the sales memorandum, oversee the due diligence process and resulting negotiations, and ensure that the best price has been attained at deal conclusion.

Acting as a safe pair of hands protects valuable company information and ensures its safe transfer to an incoming permanent FD, rather than leaving a finance vacuum at the top of the company and a very steep learning curve for the new incumbent, which can prove very costly.

In summary then, “What is an Interim Finance Director?“ He or she is a vastly experienced financial professional, often overqualified for the role, who can parachute into your business at very short notice to assist with a specific issue, project or transaction and deliver results quickly.

At Intervallum we pride ourselves with the delivery of high quality interim service provision combined with the ultimate flexibility - you turn the tap off at the point when you have had all the required targets and services delivered, and your thirst has been quenched. No notice period, no settlement agreements, no further costs.

Whether you are looking to sell your business, have a need for a safe pair of hands between permanent Finance Directors, or require urgent assistance with getting cash into your company fast, Intervallum will add value to your business from day 1.

We are the sledgehammer to crack your walnut - remember, when you need and Interim, choose Intervallum.

Paul Hooper-Keeley is the Managing Director of Intervallum Limited, a provider of Interim Finance Director Services ( ). He can be contacted at  or on 07958 155705.


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