Case Studies & Testimonials 

Pharmax is a family owned and managed company with turnover close to INR 700 Crores. Pharmax is a leading name in the Active Pharmaceutical Ingredient (API) and Finished Drug Formulation (FDF) segments which is sold in both the regulated and the generic markets in India and over 50 countries worldwide. The company has state of the art manufacturing facilities approved by US FDA and has 17 Abbreviated New Drug Application (ANDA) filed and 12 in the pipeline. 

Challenges for MyCFO 

Budgeting at Pharmax was a simple ‘spread sheeting’ exercise restricted only to collation of data inputs received from various departments. The variance between budgets and actuals for instance in financial year 13-14 was more than 80%. The variances were reported every month to the HOD’s and the management on a month on month basis for their review and comments. 

MyCFO Approach 

MyCFO’s mandate here was to play the role of an ongoing CFO for Pharamax. MyCFO’s approach was to identify the principal reason behind the budgeting exercise, which in this case was to help the management get a clear idea on the cash flow requirement and in helping them stabilize the FDF business. This was followed by a communication from the management team on the need for the departments to participate in the budgeting exercise. A 6 member budgets team was constituted which was lead by MyCFO. This was followed by one on one meetings with the department heads where targets were discussed and agreed. Some of the meetings which involved key decision making were attended by the promoters. The targets were discussed and debated amongst teams on parameters such as stock (max order quantity, credit period, lead time, logistics, distribution), debtors, creditors, zero based budgeting for PDF business, competency of personnel involved in the process, inter departmental dependencies, product strategy, capacity utilization, investment in fixed assets and ANDA, making each SBU within the company profitable, EBITDA improvement, misses and issues based on last year’s achievements amongst others. The budget exercise was finally completed in 8 weeks with 3 revisions. The exercise also served to set individual KPI’s for department heads and were eventually linked to incentives. 

How the client benefitted 

The budget exercise allowed standardization of MIS reports across the company, helped the company to institute and track performance for the Senior Managers, formation of the budget committee helped the departments to resolve potential issues which may come in the way of achievement of targets. The process also allowed a formal mechanism to review actual progress and it also set the ball rolling in terms of weekly monitoring reports on sales, cash flow, stock movement to the management.  

 

Fulex is in the business of developing fuel efficiency solutions for the Genset manufacturers. This involves carrying out R&D on the technological and commercial feasibility of the products and, once the feasibility is demonstrated, developing and manufacturing these products. The Company is in a high growth phase with a need for maintaining high level of working capital to sustain the growth, in addition to capital requirement to fund expansion. The objective of the budget exercise was (a) to develop 5 / 10 year plans, Annual Operating Plan or Annual Budgets with monthly / quarterly break-ups at a departmental and segment level (b) Determine sales targets to the sales team, broken by products, geographies, customer segments etc. (c) Determine P&L position and cash/working capital requirements at various levels of sales (d) Determine the amount of capital to be infused to support ongoing operations and expansion plans (e) Planning for manpower needs (f) Expense control, by allotting expense budgets to departments (g) Determining profitability by product, geography, customer segments etc (h) Exploring feasibility of expansion plans with metrics such ROI and IRR (i) Scenario analysis, Sensitivity analysis and “what-if” analysis through modification of the assumptions.

Challenges for MyCFO 

Budgeting at Pharmax was a simple ‘spread sheeting’ exercise restricted only to collation of data inputs received from various departments. The variance between budgets and actuals for instance in financial year 13-14 was more than 80%. The variances were reported every month to the HOD’s and the management on a month on month basis for their review and comments. 

MyCFO Approach 

(a) Arriving at a meeting point between the “top-down” and “bottom-up” approaches (b) Maintaining a balance between “trend-based” and “zero-base” approach (c) Managing iterations and version control (d) Consolidation of inputs received from diverse sources (e) Seeking consensus and “buy-in” across the organization on a common set of goals (f) Changes in assumptions after freezing the budgets (this was handled through quarterly rolling forecasts)

How the client benefitted 

The exercise helped the company to formulate its 5 and 10 year plans along with the annual operating plan, department and segment sales and expense targets were formalized, key ratios and trends were fixed and tracked, this allowed the company to benchmark key metrics against industry parameters and allowed the Board and the Management to track actuals on a periodic basis against the budgets.   

 

Commodityco is a leading company in the trading of pulses and has recently ventured into processing. An overseas Joint Venture (JV) partner has invested in Commodityco 3 years back. The business has been doubling over the last 3-4 years and Commodityco is currently at sales aggregating to INR 2,500 Crores. The aggressive growth was not backed by implementation of robust Finance and IT systems, with Tally being used till about 12 months back. The company is Family owned and the second generation promoter felt the need to support the growth by instituting better quality controls, systems and a performance driven culture which had largely been ‘personal’ with the promoter and ‘informal’. 

Challenges for MyCFO 

Some of the key challenges faced by the MyCFO team was (a) getting a good grasp of the business (dynamic business with exposure to large volumes, forex and commodity price exposures, absence of written contracts), unavailability of data relating to the past (largely in key people’s ‘memories’), competency of the existing team and to be able to connect different silos where information was hitherto residing. 

MyCFO Approach 

MyCFO’s mandate here was to play the role of an ongoing CFO for Commodityco. Commodityco and MyCFO felt the need to implement an ERP system which would help address issues on data integrity and also integration of key functions across the organization including processing locations, branches etc. The implementation of the ERP was completed in 7 months, post which the budget exercise was activated. This took MyCFO and the company another 45 days to get a ‘first draft’ of the proposed budget. The budget tracked the following parameters (a) Sales and Purchases: By Business Unit, By Commodity and By Trader (b) Processing Plant: Capacity utilization, production units and by item/commodity (C) Gross Margins: By Commodity, By Business Unit and By trader (d) Overheads and (e) Cost per ton. The budget committee in this case largely comprised of the promoters and the MyCFO team with involvement of departments on a need basis. The budget draft underwent 2 revisions post which this was rolled out/finalized. 

How the client benefitted 

The company had undertaken a budget exercise for the first time in its lifetime. The budgeting exercise was combined with the KPI exercise for the company. The concept of tracking performance against set targets/budgets was communicated and a tracking mechanism (budgets vsactuals) has been instituted on a monthly basis, providing visibility not just to the promoters but also to the JV partner.  

Pharma Group is a global leader in excipient solutions. The Group develops, produces, and markets excipeints for oral solid dose and dry powder inhalation formulations. The Group’s customers are leading pharmaceutical companies. The Group had taken over a closely held Indian company 2 years back and needed MyCFO to manage the Post merger acquisition as their India CFO. 

MyCFO role 

MyCFO’s role was to ensure correct, accurate, complete and timely review of day to day accounting based on accounting conventions and principles in line with Indian GAAP and IFRS, addressing issues that came up as part of the due diligence process, Develop and report MIS to the India CEO, Complete timely monthly reporting to Group CFO, ensure local compliances, Implement internal controls in line with Group policy, Assist in the implementation of the Group ERP (Navision), Participation in fortnightly review India CEO and the Group CFOs office, authorizing and tracking of expenses, liaise with the auditors for accounts finalization, setting the India budgets, managing and forecasting future cash flows, getting involved in monthly review meetings with the India CEO and the Group CFO and measuring business performance by setting up profit center accounting and reporting. The role comes with accountability to deliver results that an in house Controller/CFO would take on had there been one. 

How the client benefitted 

MyCFO’s involvement resulted in clean up of accounting and compliance related legacy issues, reduced monthly reporting time from 8 weeks to 1 week, implementation of an ERP system within 6 months from the start date, discontinuation of non – profitable products by developing robust costing systems and in reduction of debtors collection cycle from 120 days to less than 45 days. 

IndFrag is an 80 year old, $ 100mn Indian group and the industry leader in industrial fragrances and flavours. The company is based in Mumbai having manufacturing capacities in Mumbai, Gujarat and Netherlands. 

Our MyCFO role 

MyCFO assisted the company in a comprehensive change management project from a Promoter managed to a Professionally managed company. MyCFO was involved preparation of MIS reports, preparation of financial statements under local GAAP, analysis of product and business profitability, project managing the implementation of an ERP, preparing the data room for potential PE partners. 

How our client benefited 

Under the Promoter management, MyCFO helped in providing better visibility into the operating parameters of the business and by playing the role of an Interim CFO. The company benefited from Business Process Improvement measures and streamlining of Finance procedures. MyCFO assistance helped the company client prepare well for investor due diligence. MyCFO helped in the Promoters to obtain a good valuation from PE investors, by building a credible investment case. MyCFO helped in the smooth transition in the management of the Company. Post transition, MyCFO continues to be involved in the areas of budgeting, performance measurement, Business Intelligence, helping the new professional management and investors to move the company to the next level of growth. 

VirtualRaceis a start up promoted by professionals who have held CXO level positions in the past. Virtualrace is a pedometer based, mass participation event conducted over 100 days. Virtualrace is backed by a Venture Capital Fund and it encourages activity and health in a fun and inclusive manner that complements hectic lifestyles.

Our MyCFO role 

MyCFO plays the role of a full fledged CFO. MyCFO got involved at a pre – revenue stage to assist the promoters to monetize the business concept. Being a full blown CFO role, MyCFO also is involved in assisting the company in defining the key metrics to measure business performance, preparation of MIS, communication with the investors, negotiations with vendors, thinking through price points and customer profitability, involvement in getting the website operational, thinking through modes of distribution and logistics including tax, cash flow and profit impact and drafting employment letters and salary structures for new recruits.

How our client benefited 

MyCFO’s role extends beyond the role that a full time CFO would have handled. Considering the range of activities that Virtualrace had to get done, MyCFO provided the client support on Commercial, Financial, Accounting and Operational support. We are a Business Partner, not a Service Provider. MyCFO also plays an active role in providing periodic reports (not just accounting) to the investors and promoters which has provided visibility into the business performance. Our involvement on negotiations has helped the company to reduce costs by 30%. The payback on MyCFO’s annual fees has been less than 3 months for Virtualrace.

Diagnostic Center is an ultramodern diagnostic centre with comprehensive facilities for Laboratory, Imaging investigations and other diagnostic facilities headquartered in Mumbai. Lifecare provides digital x-ray, digital imaging, mammography, bone densitometry, sonography, cardiac imaging, advanced dentistry, spirometry, eye check up amongst others. 

MyCFO role 

MyCFO plays the role of a full fledged CFO for the Diagnostic Center which involves partnering the CEO to support the execution of Diagnostic Center’s Business Plan, implementing a high quality MIS on both the Finance and the operating side which involves defining, designing and tracking of KPI’s, providing visibility into financial and operating performance through visual dashboards to the CEO. MyCFO has also assisted the Center to implement best practices and process improvements through development of Standard Operating Procedures (SOP’s), implement performance measurement systems for the Finance team, streamlining working capital flows including setting credit controls, improve collection mechanisms from hospitals and monitoring cash flows through preparation of rolling cash flow forecasts. MyCFO also plays a commercial decision making role by being involved in equipment purchase decisions, opening of new centers and front ending discussions with existing and potential franchisees. 

How the Client benefitted 

MyCFO’s involvement helped Improve collections from 90 days to 30 days, resulted in cost savings of 20% in costs relating to re-agents and consumables, closure of non – profitable units based on unit level P&L and Break even point analysis, increased stickiness of clients through introduction of loyalty schemes based on our analysis on repeatability of clients, improved prices for certain tests buypto 30% based on accurate test level costing and improvement in sales efficiency by 10% through regular sales person performance tracking 

Digimed is an Indian group in the digital media space which has been acquired by a leading media house based in Europe. 

Our MyCFO role 

MyCFO's mandate is to streamline the accounting and reporting function in line with the group’s global practices. The role entails booking revenues on time, authorizing and keeping track of expenses including expense budgeting, managing and forecasting future cash flows, identifying areas where underlying IT/Manual processes can be improved, in addition to managing the routine accounting, tax and compliance functions. MyCFO’s role is that of an outsourced CFO assisting the group with the full range of CFO functions (Budgeting, Process improvements, Performance measurement, compliance, accounting etc) and comes with accountability to deliver results that an in house CFO would take on had there been one. 

How our client benefited 

MyCFO assisted in the 'clean up' of accounting and compliance related legacy issues, dating back to 4 years prior to the date of change in ownership and management. This exercise provided much needed visibility to the new owners on the true state of business performance of the company, reduced monthly reporting times from 6 weeks to 6 days, improved control standards dramatically and helped in the recovery of old debtors. MyCFO has assisted the company in savings on the costs of an expensive CFO, while making sure that adequate skill sets are always available to meet the growth requirements of the company.  

Implant India is an exclusive distributor of orthopedic implants and joint replacement products. The parent company is a leader in the manufacture and distribution of medical implants. The group is amongst the top 3 companies in this space globally. 

MyCFO role 

MyCFO role involves acting as the sounding board to the business team at Implant India. The role involves helping the management with a 3 year business plan, cash flow forecasting and fund management, inventory control, distributor evaluation and decision making based return on investment calculations, driving the finance agenda for Implant India, Product costing and fixing pricing and to play the role of a partner to the CEO/ business. 

How the Client benefitted 

MyCFO’s involvement has helped in 15% reduction in inventory holding through better visibility on implant consumption patterns, 10% improvement in sales through better distributor performance management, cash flow improvements by 12% through reduction in debtor days, 25% improvement in order to dispatch turn around time, implementation of bar coding system to help track inventory movement 

Build Well is a reputed name in the civil construction/ projects space and has been in existence for over 5 decades with revenues over INR 600 crores. The company has been at the forefront of several prestigious commercial, residential and retail projects both in India and overseas. Build Well is backed by a leading PE fund. 

MyCFO role 

MyCFO’s role was to strengthen the Finance and Internal control systems and to specifically build and monitor cash flows and budgets across various projects and across sites in India. MyCFO was required to monitor and raise red flags when there were deviations relating to project payments as compared to the budgets and also to strengthen controls to reduce invoicing, certification delays, speed up collections and to improve site level stock and accounting controls. 

How the client benefitted 

MyCFO team took over the responsibility as the ‘Cost Control’ function at Build Well. The MyCFO team interacted with the site – level costing, projects, accounting and stores teams to review, recommend and implement changes at the site level. 

MyCFO’s involvement resulted in reduction of billing delays by 50% and resulted in lower billing delays. This also resulted in timely submission of MIS to the board, investors and the management. 

Organic Foodis a Private Equity (PE) invested fast growing Indian company in the supply chain space. Organicfood’s business model is to procure, store, process and on – sell the produce from farmers to the end consumers. The company takes on the responsibility of guaranteeing marketability of the farmer’s produce and also ensuring that the produce meets the highest standards.

Our MyCFO role 

MyCFO played the role of an interim CFO for this company which has grown from INR nil to INR 120Cr in revenues in 4 years and is expected to be INR. 500Cr in the next two years. MyCFO assisted the company with the entire gamut of CFO roles, with a particular emphasis on MIS and in defining the reports to be delivered through a Business Intelligence (BI) tool, thinking through the scope document aiding the company in tightly defining the expectations from the ERP thereby also helping them with vendor selection and negotiations and inventory control.

How our client benefited 

Our MyCFO has allowed the Promoter to focus on his business while leaving the entire Strategic and Operational aspects of the Finance department to WealthTree. Being an organics food company which was subject to the vagaries of the environment, our recommendations on development of a costing model with emphasis on considering interest on working capital as part of the product cost was appreciated and this resulted in ascertaining an accurate profit margin. This was significant since the company was operating on wafer thin margins with working capital being stuck in debtors and inventory for over 4 months. Our appointment has helped Promoters to achieve Finance department objectives at a cost which is nearly 50% cheaper that recruiting a full time CFO