I'm excited to share a success story with you today! Recently, we had the pleasure of working with a PE firm to help one of its newly acquired company (‘Investee’) to transition from cash basis to accrual basis. Both these entities are based in mid-west.

The Challenge:
The Investee company had been using cash basis accounting since their launch almost 20 years ago. While this method is simple, it did not provide a complete picture of the company's financial health to the Investors. Cash basis of accounting made it difficult for the PE firm to:
• Track profitability accurately
• Make strategic decisions
• Report to Limited Partners

The Solution:
We worked closely with the PE firm and the Investee company team to understand their business and accounting needs. We then guided them through the process of transitioning to accrual accounting. This involved:
• Setting up a new accounting system and practices suitable for accrual accounting
• Formulate their revenue recognition policy (was very complex but critical to business)
• Training their team
• Reconciling historical data

The Success:
The transition to accrual accounting has been a game-changer for the stakeholders. They now have:
• Improved financial visibility
• Better decision-making
• Enhanced reporting to investors

Client Feedback:
Client was thrilled with the results of the brutal but necessary project that took a few months (especially because of lack of proper systems and records to support accrual basis of accounting). The transitioning to accrual accounting was successful and all the investors were pleased with the results.
Are you ready for a clearer financial picture?

Contact Us today if you would like to know more or if we could support you with your Accounting needs. ALPHAXN provides Fractional CFO, Fractional Controller, Bookkeeping, and Audit support services. You can reach us at --@----.com