Assessments Provide Actionable Analysis for Restructuring

Is the current business plan viable? Is liquidity sufficient? Are further cuts necessary? Here are suggestions to improve restructuring plans.

In times such as these, the concerns of economic stakeholders are many: Is the current business plan viable? Is liquidity sufficient? Are further cuts necessary? Increasingly, these stakeholders have made use of an external expert opinion to validate and improve restructuring plans.

David Johnson of Turnaround Management Association outlines what can be done with assessments. An assessment can take many forms, but broadly speaking, it is a short-term, limited-scope assignment that seeks to provide an actionable analysis for a restructuring plan. Typically an assessment might involve one or more of the following elements:

Business Plan Review. Revisit the assumptions that underlie business plans. By recognizing key changes in the economic environment and explore the best response, an assessment can offer a valuable reality check.

Liquidity Analysis/Financial Projections. The ability to forecast financial performance and availability on credit facilities is a key tool in ensuring the survival of a company. External assessment detailed financial forecasts..

Operational Restructuring. Assessment of whether previous cost cutting measures were sufficient. External review of the strategies and tactics to rationalize cost structures.