Sensible Cost Reduction in a Crisis
Effective opportunities often exist in procurement, in and in the area of , specially by reducing structural cost. are tempting and often also sensible.
Take Care When Reducing Commercial Jobs
But also take a differentiated look at costs. Far too often, in order to increase earnings, savings are made first where costs can be cut most easily. All too often, this is the commercial workforce. Staff cuts in the commercial sector have a positive effect on earnings in the short term, as long as no …
Be Brave When Reducing Structural Costs
In contrast, it is worth taking a critical look on a regular basis at structural costs, which creep up over time. Example: According to one narrative, there was a study in the British Navy that found that the number of officers would continue to increase even if there was not a single ship left at …
Turnaround management to overcome crisis
If your company has fallen into an economic crisis, you must intervene courageously with a holistic turnaround management approach. It is no longer enough to inject liquidity into your company to turn it around. Deeper-lying causes of the crisis must be identified and reliably eliminated. Sham solutions do not lead to sustainable turnaround. As a …
Tailor-Made Restructuring Concepts
The beginning of every restructuring is a convincing restructuring concept. The Düsseldorf-based Institut der Wirtschaftsprüfer (Institute of Public Auditors in Germany) has developed standards for such restructuring concepts and defined the requirements for . If your company is close to insolvency, a going concern forecast in accordance with is strongly recommended to identify the and …
Corporate restructuring with going concern forecast according to IDW S6
IDW S6: The standard for expert opinions on the ability of companies to continue as a going concern The Institute of Public Auditors in Germany (Institut der Wirtschaftsprüfer, IDW) has developed a guideline for restructuring concepts with a going concern forecast and published it as IDW S6. The three basic questions in restructuring cases are …
Need for remediation: Is there a case for redevelopment?
The system set out in IDW Standard 6 initially requires the report to confirm whether the company is in need of restructuring. A restructuring case exists precisely when the company is in danger of insolvency. But even then, it may be a case of insolvency that can be quickly eliminated or it might be a …
Restructurability: Can the company be restructured?
In the second step, the report should determine whether the company in need of restructuring is capable of being restructured within a reasonable period of time and which conditions must be met for sustainable restructuring. The special requirement for an IDW S6 report to determine whether your company is capable of continuing as a going …
Redevelopment eligibility: Is the company ready for it?
In the final step, the report should provide a statement as to whether at least the shareholders are prepared to fulfil the necessary conditions, i.e. whether they also consider the company to be worth restructuring. This willingness is usually obtained in the report by the signature of the shareholders. Such a report is then presented …
Going Concern Forecast in Accordance with IDW S9
However, if you are already close to insolvency, it is advisable for you to obtain a certificate confirming that your company is not (yet) in insolvency, but only in imminent insolvency. As a reference, in Germany, such a certificate should be edited in accordance with IDW S9. There may even currently be a payment stoppage, …