Fictional P&L or Reliable Map of the Year ahead?

by Feb 9, 2021Technical

Imagine the scene. You are in charge of an online retailer with a complicated array of products that spans halogen heaters to incontinence pants, garden hoses to PPE and a turnover of over £40m. Your main business manager has left the business and the spreadsheet for financial forecasting looks large, complicated and no-one understands it.

It turns out that neither did your newly departed former colleague – because when we set about converting the spreadsheet to Azquo, the labyrinthine calculations and logic contained a fatal flaw. Sure, the year-end profit figure looked about right and in line with expectations and as such the remaining management team use it to inform and guide their operations for over half a year.  It transpired that the spreadsheet had been manipulated with two figures randomly hard-coded into two cells (in place of the intended calculation) which had the effect of showing a £2m Gross Profit for the year-end. When the calculation was carried down the column correctly – this had the effect of projecting a negative GP of -£2m!

The P&L was essentially a work of total fiction.

Hence, the business case was made and we enabled the business to see, in a single place, all of the logic clearly set out in such a way that no similar error could be made ever again. More than that, the process for forecasting the financial and operational parameters of operation is now quick, transparent, flexible and is understood by all. Budgets and actuals can be quickly compared down to a granular level, enabling more accurate plans to be made for the future.

The takeaway from all of this is that at its heart, the same processes can be adopted so there is immediate familiarity working with Azquo because we use Excel extensively. Everything that can be automated is automated. Everything that is added to the system is tracked and traced. Any figure that changes can be checked through its component parts by any user.

Azquo has created certainty, confidence, speed and accuracy. What this means for the client is that they are using an accurate map for each month and able to link their forecasts (both tactical and strategic) with their daily performance actuals. Azquo delivers actionable insight faster than anyone else.

NB – You will understand why it is impossible to name this retailer. Not only was the work subject to an NDA, but the problems we highlight below would be reputationally damaging for our client.