Thursday, March 6, 2008

Top 3 Financial Reporting Tips

Bart Holemue – Financial Wizard and WFR Staff Writer

If there’s one thing I’ve learned after 27 years as a financial wizard it’s that you can never be too cautious about how your company’s pecuniary reports are digested by prospective investors. More significantly, when spotlighting the international aspect of this beast it becomes even more imperative to ensure the most helpful information is being displayed. This might not always be easy, especially when the readers typically are government employees and potential investors on a global scale! Here are 3 tips to writing reports that financial analysts want to read and invest in - regardless of locale.

Be Profitable! This might sound obvious to most business savvy individuals, but investors tend to choose entities which have more assets than liabilities. As you can imagine, showing a loss can be quite detrimental to future investment. Quite simply, if you feel you will be profitable in the future, make sure you account for that. The easiest way I’ve found is to add future sales to your accounts receivables while concurrently undervaluing your liabilities, for example: If you attend a business conference and you meet with 10 clients and expect $50,000 in new business from each of them in the next 3 months this formula would be calculated C*n=AR+aAR where C are your potential deals, n is the total spend on each deal, AR is accounts receivable, and aAR are actual accounts receivables. So in this case we have: 10 x $50,000 that’s half a million dollars! I know what you’re thinking…Bart, some will not get to the 50k mark quarterly, exactly some may do much, much, more!

Growth. Is your business growing and what exactly is growth? Growth might not be your current business. In fact, growth is a relative term. For example, if you take a market survey and only 1% of people have heard of your brand this is not wholly accurate. In fact, 100% of that percentage those people are familiar with the brand, and a certain percentage of their friends are also aware. Compounded, with the original percentage this total market cap could be well over 100%. Think about it, investors certainly will…

Finally, investors want what they think other investors want. This may be the most important element of all. I find the most effective method to do this is hold shareholder meetings and invite potential investors. The best way to locate current investors (who can help you encourage new investment) are agencies such as or I’ve found for around $50,000 you can employ over 100 shareholders for nearly two hours. Simply invite twice as many potential investors and include testimonials from the “current” investors. Combined with a $5,000 outlay for a conference hall at your local hospitality establishment with food and beverages one could parlay $55,000 into almost a million in capital in a fraction of a day.

In all, there are many ways to encourage your financial reporting success. These are only three points out of a myriad of options. We will be holding a meeting at the Radisson in Minnesota in late April 08, please email me at for details, we hope to see you there!

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