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Plan Outline
Auditing and Consulting Business Plan
Artemide Auditing & Consulting AG
This sample business plan can be edited directly in Business Plan Pro software.
Financial Plan
The following sections include the annual estimates for the standard set of financial tables. Detailed monthly pro-forma tables are included in the appendix.
7.1 Important Assumptions
This information is presented in the table below.
| General Assumptions | |||
| 2003 | 2004 | 2005 | |
| Plan Month | 1 | 2 | 3 |
| Current Interest Rate | 10.00% | 10.00% | 10.00% |
| Long-term Interest Rate | 10.00% | 10.00% | 10.00% |
| Tax Rate | 25.00% | 25.00% | 25.00% |
| Other | 0 | 0 | 0 |
7.2 Key Financial Indicators
The Benchmark chart below uses index values to compare past and future financial indicators. The bars show relative change, not absolute values.
7.3 Break-even Analysis
With our average monthly fixed costs, Artemide will surpass break even consistently throughout the next year of operations.
| Break-even Analysis | |
| Monthly Revenue Break-even | £9,744 |
| Assumptions: | |
| Average Percent Variable Cost | 16% |
| Estimated Monthly Fixed Cost | £8,185 |
7.4 Projected Profit and Loss
The projected profit and loss information is presented in the table and charts below.
| Pro Forma Profit and Loss | |||
| 2003 | 2004 | 2005 | |
| Sales | £160,977 | £193,172 | £231,807 |
| Direct Cost of Sales | £25,758 | £29,622 | £34,065 |
| Other | £0 | £0 | £0 |
| Total Cost of Sales | £25,758 | £29,622 | £34,065 |
| Gross Margin | £135,219 | £163,551 | £197,742 |
| Gross Margin % | 84.00% | 84.67% | 85.30% |
| Expenses | |||
| Payroll | £72,000 | £77,000 | £86,000 |
| Sales and Marketing and Other Expenses | £6,897 | £9,500 | £13,000 |
| Depreciation | £2,400 | £2,500 | £2,500 |
| Leased Equipment (incl. office rental) | £2,400 | £2,500 | £3,000 |
| Utilities (incl. office furniture, etc.) | £1,800 | £2,000 | £2,500 |
| Insurance | £1,200 | £1,500 | £2,000 |
| Rent | £0 | £0 | £0 |
| Payroll Taxes | £11,520 | £12,320 | £13,760 |
| Other | £0 | £0 | £0 |
| Total Operating Expenses | £98,217 | £107,320 | £122,760 |
| Profit Before Interest and Taxes | £37,003 | £56,231 | £74,982 |
| EBITDA | £39,403 | £58,731 | £77,482 |
| Interest Expense | £0 | £0 | £0 |
| Taxes Incurred | £9,251 | £14,058 | £18,745 |
| Net Profit | £27,752 | £42,173 | £56,236 |
| Net Profit/Sales | 17.24% | 21.83% | 24.26% |
7.5 Projected Cash Flow
The projected cash flow and cash balance information is presented in the chart and table below.
| Pro Forma Cash Flow | |||
| 2003 | 2004 | 2005 | |
| Cash Received | |||
| Cash from Operations | |||
| Cash Sales | £0 | £0 | £0 |
| Cash from Receivables | £149,782 | £188,617 | £226,341 |
| Subtotal Cash from Operations | £149,782 | £188,617 | £226,341 |
| Additional Cash Received | |||
| Sales Tax, VAT, HST/GST Received | £0 | £0 | £0 |
| New Current Borrowing | £0 | £0 | £0 |
| New Other Liabilities (interest-free) | £0 | £0 | £0 |
| New Long-term Liabilities | £0 | £0 | £0 |
| Sales of Other Current Assets | £0 | £0 | £0 |
| Sales of Long-term Assets | £0 | £0 | £0 |
| New Investment Received | £0 | £0 | £0 |
| Subtotal Cash Received | £149,782 | £188,617 | £226,341 |
| Expenditures | 2003 | 2004 | 2005 |
| Expenditures from Operations | |||
| Cash Spending | £72,000 | £77,000 | £86,000 |
| Bill Payments | £66,312 | £69,717 | £85,791 |
| Subtotal Spent on Operations | £138,312 | £146,717 | £171,791 |
| Additional Cash Spent | |||
| Sales Tax, VAT, HST/GST Paid Out | £0 | £0 | £0 |
| Principal Repayment of Current Borrowing | £2,895 | £0 | £0 |
| Other Liabilities Principal Repayment | £0 | £0 | £0 |
| Long-term Liabilities Principal Repayment | £0 | £0 | £0 |
| Purchase Other Current Assets | £0 | £0 | £0 |
| Purchase Long-term Assets | £24,000 | £0 | £0 |
| Dividends | £0 | £0 | £0 |
| Subtotal Cash Spent | £165,207 | £146,717 | £171,791 |
| Net Cash Flow | (£15,425) | £41,901 | £54,550 |
| Cash Balance | £77,226 | £119,126 | £173,676 |
7.6 Projected Balance Sheet
The projected balance sheet information is presented in the table below.
| Pro Forma Balance Sheet | |||
| 2003 | 2004 | 2005 | |
| Assets | |||
| Current Assets | |||
| Cash | £77,226 | £119,126 | £173,676 |
| Accounts Receivable | £22,776 | £27,331 | £32,797 |
| Other Current Assets | £1,158 | £1,158 | £1,158 |
| Total Current Assets | £101,160 | £147,616 | £207,632 |
| Long-term Assets | |||
| Long-term Assets | £30,948 | £30,948 | £30,948 |
| Accumulated Depreciation | £2,400 | £4,900 | £7,400 |
| Total Long-term Assets | £28,548 | £26,048 | £23,548 |
| Total Assets | £129,708 | £173,664 | £231,180 |
| Liabilities and Capital | 2003 | 2004 | 2005 |
| Current Liabilities | |||
| Accounts Payable | £4,094 | £5,877 | £7,156 |
| Current Borrowing | £0 | £0 | £0 |
| Other Current Liabilities | £0 | £0 | £0 |
| Subtotal Current Liabilities | £4,094 | £5,877 | £7,156 |
| Long-term Liabilities | £0 | £0 | £0 |
| Total Liabilities | £4,094 | £5,877 | £7,156 |
| Paid-in Capital | £5,000 | £5,000 | £5,000 |
| Retained Earnings | £92,862 | £120,614 | £162,787 |
| Earnings | £27,752 | £42,173 | £56,236 |
| Total Capital | £125,614 | £167,787 | £224,023 |
| Total Liabilities and Capital | £129,708 | £173,664 | £231,180 |
| Net Worth | £125,614 | £167,787 | £224,023 |
7.7 Business Ratios
Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 8721.01 - Auditing services, are shown for comparison.
| Ratio Analysis | ||||
| 2003 | 2004 | 2005 | Industry Profile | |
| Sales Growth | -0.72% | 20.00% | 20.00% | 8.60% |
| Percent of Total Assets | ||||
| Accounts Receivable | 17.56% | 15.74% | 14.19% | 24.40% |
| Other Current Assets | 0.89% | 0.67% | 0.50% | 46.70% |
| Total Current Assets | 77.99% | 85.00% | 89.81% | 74.90% |
| Long-term Assets | 22.01% | 15.00% | 10.19% | 25.10% |
| Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
| Current Liabilities | 3.16% | 3.38% | 3.10% | 42.80% |
| Long-term Liabilities | 0.00% | 0.00% | 0.00% | 17.20% |
| Total Liabilities | 3.16% | 3.38% | 3.10% | 60.00% |
| Net Worth | 96.84% | 96.62% | 96.90% | 40.00% |
| Percent of Sales | ||||
| Sales | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Margin | 84.00% | 84.67% | 85.30% | 0.00% |
| Selling, General & Administrative Expenses | 66.89% | 62.95% | 61.14% | 83.50% |
| Advertising Expenses | 2.05% | 2.07% | 2.59% | 1.20% |
| Profit Before Interest and Taxes | 22.99% | 29.11% | 32.35% | 2.60% |
| Main Ratios | ||||
| Current | 24.71 | 25.12 | 29.01 | 1.59 |
| Quick | 24.71 | 25.12 | 29.01 | 1.26 |
| Total Debt to Total Assets | 3.16% | 3.38% | 3.10% | 60.00% |
| Pre-tax Return on Net Worth | 29.46% | 33.51% | 33.47% | 4.40% |
| Pre-tax Return on Assets | 28.53% | 32.38% | 32.43% | 10.90% |
| Additional Ratios | 2003 | 2004 | 2005 | |
| Net Profit Margin | 17.24% | 21.83% | 24.26% | n.a |
| Return on Equity | 22.09% | 25.13% | 25.10% | n.a |
| Activity Ratios | ||||
| Accounts Receivable Turnover | 7.07 | 7.07 | 7.07 | n.a |
| Collection Days | 59 | 47 | 47 | n.a |
| Accounts Payable Turnover | 14.37 | 12.17 | 12.17 | n.a |
| Payment Days | 33 | 25 | 27 | n.a |
| Total Asset Turnover | 1.24 | 1.11 | 1.00 | n.a |
| Debt Ratios | ||||
| Debt to Net Worth | 0.03 | 0.04 | 0.03 | n.a |
| Current Liab. to Liab. | 1.00 | 1.00 | 1.00 | n.a |
| Liquidity Ratios | ||||
| Net Working Capital | £97,066 | £141,739 | £200,475 | n.a |
| Interest Coverage | 0.00 | 0.00 | 0.00 | n.a |
| Additional Ratios | ||||
| Assets to Sales | 0.81 | 0.90 | 1.00 | n.a |
| Current Debt/Total Assets | 3% | 3% | 3% | n.a |
| Acid Test | 19.15 | 20.47 | 24.43 | n.a |
| Sales/Net Worth | 1.28 | 1.15 | 1.03 | n.a |
| Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |