accelerating depreciation 196
accounting policies 146
accounts payable 231, 299
accounts receivable 223, 229, 295, 298
accruals 145, 211, 224, 231
acid test 296
acquisition costs 195, 197
acronyms 35
administration 76, 125–6
after‑sales service 98
Amazon 246
amortisation 193
angel investors 243
annexes 16, 37
antitrust laws 92
approval 11, 286, 288–93
asset‑push strategy 121
assets
current assets 228, 229–30
intangible assets 231
see also xed assets
auditors’ reports 313
available market 96
average total cost 267–8
averaging inventory 182
backward integration 114–15
bad debts 209
balance sheets 141, 143–4, 221–33
owners’ equity 144, 229, 232
sources and uses of funds 144, 227
see also assets; liabilities
banks 245, 281
deposits 147
benchmarking 99
bindings 27, 37
biographies 72
blogs 88
board committees 73
body language 310
body of the plan 37, 41
Body Shop 63
Boeing 61
bottom‑up approach 18
breakeven analysis 264–7
budgets 45, 149–50, 214–15, 331–7
buer stock 271
building societies 245
bullet points 17
business cards 27
business condence surveys 169
business cycle 91, 163–7
business details 57–8
business history 65
business partners 94–5
business strategies 114–19
capacity planning 123, 265
capital spending 140, 191–3, 196, 226–7
capitalising costs 210
career development 76
cash accounting 145
cash at bank 229, 315
cash cows 112, 117
cash ow 95, 112, 126, 141, 221–8, 233–9
decits 233, 235
discounted cash ow (DCF) yield 274–5
forecasts 153, 272
and ination 273
and net prot 221
surpluses 233, 239
cash outlays 223
central objective 59–60
CEO (chief executive ocer) 73
chairman 74
channels to market 94
charts see tables and charts
chasing up recipients 307, 312
circulation control 28, 29
columns to the page 30–1
communication 323–4
comparisons 295
competitive advantage 78, 84–5, 91, 103–5
competitors 86–7, 100–2
completion times 132
computer software 25–6, 154–6
concentric diversication 117
conclusion 41, 50
condentiality 29–30, 306
conglomerates 115, 117
consolidated accounts 230
consultants 17–18
contact details 34
contacting recipients 303–6
contents page 34, 45–6
contingencies 216, 233, 297
contracts 314
copyright 29–30
INDEX 347
Index
348 INDEX
core competencies 57, 78–9
correlation analysis 168–9
corruption 92
cost of capital 276–8
cost of sales 176–83
cost‑plus pricing 125
costs 67, 141, 176–83, 191, 334–5
average total 267–8
breakeven analysis 264–7
breaking down 70
capitalising 210
cash outlays 223
contingencies 216, 233, 297
current costs 191
direct costs 179
xed costs 180
indirect costs 177
marginal costs 267–8
materials 177
operating costs 192, 193, 202–11, 264
production costs 177–80, 191
start‑up costs 201
and value 98
variable costs 179
covering letters 306
covers 27, 33–4
credits 144, 146, 147
critical path analysis 131, 132
critical success factors 110
cumulative preference shares 246
currencies 6, 92, 281
current assets 228, 229–30
current costs 191
current liabilities 228, 231–2
current ratio 296
customers
and research 85–7, 173
segmentation 96–7
data collection 85–9
dates 155
De Havilland Comet 61
debentures 232
debits 144, 146, 147
debt 240, 241–3, 245
indicators 297
decision‑making 9, 278–9
defensive strategies 118
denitions 6, 8, 35
demand elasticity 125
demand estimation 99, 170–4
demographics 90
departmental strategies 119–27
administration 125–6
pricing 125
production 123–4
products 119–21
research & development 121–2
sales 124–5
support services 125–6
depletion policies 193
deposits 120, 231
depreciation 145, 193–6, 207, 210
deregulation 92
detail 3–4, 16
diagrams see tables and charts
dierentiation 97, 120
direct costs 179
directories 88
directors 71–2, 73
disaster recovery 89
discount rates 274
discounted cash ow (DCF) yield 274–5
distribution channels 94
distributors 94
diversication 117
divestments 118
dividend cover 300
divisional organisations 71
document control 28–9, 34
documented plans 10–11, 15
double declining balance 196
double entry accounting 144, 146
dress 308
due diligence 313–14
dying businesses 116
earnings per share (EPS) 59, 248–9, 299
economic value added 300
economy 90–1, 169–70, 281
business cycle 91, 163–7
elasticity of demand 125
empire building 69
employees 74, 123, 204–5, 329–31
end dates 132
equity capital 240–3
estimates 170
EVA momentum 300, 302
exchange rates 6, 92, 281
executive summary 41, 47–9, 295
expense accounts 147
expert opinion 173
export guarantees 281
external plans 285, 291–3
Facebook 88
factoring 245
facts 49
failure 292–3, 337
INDEX 349
nance leases 197–8
rst‑in rst‑out (FIFO) 182
xed assets 76, 143, 147, 193–202
acquisition costs 195, 197
balance sheet entries 228, 230–1
capital spending 140, 191–3, 196, 226–7
depreciation 193–6, 207, 210
land and buildings 76, 201, 202
operating life 196, 201–2
register 194–5
replacing 197
valuation 195
xed budgets 150
xed costs 180
exible budgets 150
following up 311
fonts 33
formal documentation 10–11, 15
forward integration 115
franchises 246
functional organisation structure 69, 70
funding 11, 41, 49, 153–4, 222, 239–49
contracts 314
due diligence 313–14
equity capital 240–3
hybrid nance 246
interest payments 237
loan capital (debt) 240, 241–3, 245
maximum requirements 235
sources of funds 243–6
start‑up capital 243
terms of the deal 247–8
uses of funds 296
venture capital 11, 12, 243, 287
Gantt charts 131, 135
gearing 241, 277, 297
general managers 72, 74
globalisation 93
going concern 146
goodwill 201
government funding 245
government policy 91–2
gross prot 184
hand‑outs 307
handbooks 328
headers and footers 31
headings 17, 33
history of the business 65
horizontal diversication 117
horizontal integration 115
human resources 126
hurdle rates 274, 276–8
hybrid nance 246
identication codes 28–9
import guarantees 281
incentives 92, 339
independent directors 73
indirect costs 177
industrial incentives 92
industry environment 100–2, 170–4
ination 273
information sources 85–9
information technology 93, 126
infrastructure 76
insurance values 195
intangible assets 231
integration strategies 114, 115
intellectual property 79, 126, 202
interest income 216
interest payments 237
intermediaries 95
internal audits 57
internal plans 285, 289–91
internal rate of return (IRR) 198, 274–6
inventory 123, 181–3, 210, 230, 270–1
averaging 182
buer stock 271
carrying costs 270
rst‑in rst‑out (FIFO) 182
just‑in‑time management 271
last‑in rst‑out (LIFO) 183
ordering costs 270
specic unit costs 182
turnover ratio 299
investments 230
income 216
ratio analysis 299–300
ISO quality standards 28, 29
joint ventures 118
just‑in‑time management 271
land and buildings 76, 201, 202
last‑in rst‑out (LIFO) 183
law of diminishing returns 264
leading indicators 167–9
leases 197–8, 210, 233, 245
Lehman Brothers 302
length 3–4, 16–17, 37
leverage 241, 277, 297
liabilities 143, 147, 228, 231–2
contingencies 216, 233, 297
o‑balance sheet 210, 233
licensing 246
limiting factors 255
liquidity ratios 296
350 INDEX
loan capital (debt) 231, 232, 240, 241–3, 245
lobbying 92
long‑term assets see xed assets
long‑term liabilities 228, 232
macro environment 83
management buyouts (MBOs) 66, 246
management by objectives 330–1
management consultants 17–18
management skills 17–18
management team 70–1, 72, 74
managing director 74
manuals 328
manufacturing accounts 180
marginal analysis 267–9
marginal costs 267–8
margins 30–1, 298
market intelligence 85–9
market to book ratio 300
market values 195
market‑intensive strategies 116
market‑pull strategy 121
marketing 121, 124–5
markets 96–9
channels to market 94
demand elasticity 125
demand estimation 99, 170–4
development 116
penetration 116
positioning 96
segmentation 96–7
master plan 44
matching transactions 144
materials 177
matrix organisations 71
meetings 50–1, 290–1, 307–11
agreeing actions 310–11
body language 310
dress 308
following up 311
hand‑outs 307
questions 309
see also presentations
mentors 290
mergers 118
micro environment 83
minimum economic price 269
minority shareholdings 230
mission statements 61, 62–3
monetary policy 92
monitoring 337–8
monopolies 92
mortgages 232
motivation 323–4
multiple businesses 44–5, 111–14
natural resources 231
needs and benets 62
net asset value 300
net present value (NPV) 274
net prot 191, 192, 211–15, 221
network diagrams 131
niche markets 85
non‑disclosure agreements 29–30
non‑prot organisations 118
normal distribution 254, 256–63
objectives 41–2, 59–60, 127–8, 329–38
o‑balance sheet liabilities 210, 233
operating accounts 181
operating costs 192, 193, 202–11, 264
bad debts 209
employees 204–5
functional areas 204
relationships between 209
seasonal patterns 204, 209
see also costs
operating eciency 298–9
operating leases 197–8
operating life of assets 196, 201–2
operating plans 129–35
operating procedures 325–8
operational management 12
opportunities 52–4
order of sections 16
ordering costs 270
organisation chart 58, 71–6
organisation structure 69–70
outline document 30–7
outsourcing 95, 115
overall impression 27–8
owners’ equity 144, 229, 232
page numbering 33
page setup 26, 30–3
paper size 30
partnerships 315
pay‑back times 276
penetration 116
pension obligations 232
personal presentation 308
PERT (program evaluation and review) 131
philosophy 61, 63–4
planning horizon 149
planning to plan 50–1
policies 325–8
portfolio strategy 111–14
positioning 96
potential market 96
preference shares 246
premises 76, 201, 209
INDEX 351
prepayments 145, 225, 230
present value 273–4
presentations 25–38, 307
bindings 27, 37
circulation control 28, 29
computer software 25–6
document control 28–9, 34
outline document 30–7
overall impression 27–8
personal presentation 308
printing 27
see also meetings
president 74
pressure groups 92
price earnings (P/E) ratio 248–9, 300
pricing 125, 269
printing 27
priorities 41–2
privatisation 92
procedures 325–8
processes 123
production 123–4
costs 177–80, 191
optimum production level 265
products and services 77–8, 86, 119–21
demand 170–4
development 116
life cycles 172–3
prot and loss account 141, 180–1, 191
gross prot 184
margins 298
maximising prot 9, 59
net prot 191, 192, 211–15, 221
ratio analysis 298–9
retained prots 232
project appraisal 271–80
cash ow forecasts 153, 272
decision making 278–9
discount rates 274
hurdle rates 274, 276–8
internal rate of return (IRR) 198, 274–6
net present value (NPV) 274
pay‑back times 276
present value 273–4
what‑if analysis 154, 279–80
project planning 131–2, 134
projections 170
provisions 211
public spending 92
quality 123
questions at meetings 309
quick ratio 296
ratio analysis 296–302
receivables turnover ratio 295
references 34
register of assets 194–5
regression analysis 168–9
regulations 92
rejection 312
relevance of ideas 42
replacing assets 197
research 85–9
research and development 121–2, 201
resource requirements 127
responsibilities 18–19, 50–1
retained prots 232
retrenching 118
return on equity 241, 299, 301–2
return on investment (ROI) 11, 239, 298, 301
revenue sensitivity 277
reviewers of plans 289, 290–1
risk management 253–82
breakeven analysis 264–7
capacity planning 265
economic risks 281
marginal analysis 267–9
normal distribution 254, 256–63
project appraisal 271–80
skewed distribution 256
standard deviation 257–63
types of risk 255–6
worst‑case analysis 281–2
z scores 260, 262–3
risk premium 276–8
risk and return 112, 276
Rolex 100
rules 325–8
salaries 332
sales 124–5, 140
cost of sales 176–83
revenue sensitivity 277
volume of sales 161–74
sales forces 173
savings and loan associations 245
scenario planning 154
search engines 88
seasonal trends 164–5, 204, 209
sections 16, 17
segmentation 96–7
services see products and services
several businesses 44–5, 111–14
share prices 59, 60
shareholders 73, 240
equity 144, 292
value 59
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