The Great Recession: Mergers and Acquisitions on the Rise
As the global economy moves closer to a recession, it is not uncommon to see an increase in mergers and acquisitions.
Mike Whitmire is the leader of pre-IPO fintech company FloQast. A former accountant, he is now using his skills to help the company grow and succeed. With his experience and knowledge, he is well-positioned to take the company to the next level.
It's clear that the economy is in a turbulent state and businesses are feeling the effects. While it's still debatable whether or not we're technically in a recession, it's clear that things are not good. It's important to be prepared for significant changes in the coming months and years.
There are a few key shifts happening in the world of capital markets, and one of them is an increase in public-to-private transactions, specifically mergers and acquisitions. Historically, M&As have tended to grow in challenging market environments while public offerings like IPOs become less attractive. This is usually because IPOs are seen as a financing event that recapitalizes the company, while a company sale is a liquidity event.
As companies increasingly turn to mergers and acquisitions as a growth strategy, they face unique challenges. The consolidation that results from a merger or acquisition can magnify the pressure and complexity of the business, from the financial close to reporting to sales and operations. This can make it difficult for companies to realize the benefits of the transaction and can create significant challenges for employees.
As the business world increasingly turns to mergers and acquisitions to grow and succeed, the role of the finance department, and accountants in particular, becomes more important than ever. Accountants have the skills and knowledge to help companies navigate the complexities of these transactions and ensure that they are financially sound. With their help, companies can confidently move forward with these deals, knowing that their finances are in good hands.
Accounting teams play a vital role in ensuring the success of any merger or acquisition. They are responsible for providing accurate financial information and analysis, which is essential in making sound decisions about the transaction.
The last two decades have been a pressure cooker for accountants, who have had to become experts in dealing with complex matters and executing difficult projects. With tighter deadlines, volatile markets, and expanding and changing businesses, accountants have had to pivot from tactical, back-office roles to strategic middle-office hubs that have a pulse on the health of the organization. And they've done all this while performing the traditional tasks of accounting with a shrinking workforce and increased burnout. This "farmer's strength" in dealing with tough times makes accountants perfect leaders to support business functions and navigate turbulent times.
As an accountant, I have a unique perspective on how businesses operate. I understand the inner workings of a company and how it affects the bottom line. I also have a keen understanding of financial reporting, budgeting, and compliance. This allows me to provide businesses with a comprehensive view of their situation and how they can improve.
As businesses increasingly look to mergers and acquisitions as a way to grow, the role of accountants will become even more important. They will be responsible for ensuring that all financial data is accurate and compliant with regulations. Additionally, their deep understanding of the inner workings of businesses will be invaluable in helping to construct deals that are financially sound and will benefit the company in the long term.
Accountants are playing an increasingly important role in the growth and success of companies, with their influence extending all the way to the C-suite, according to FloQast's State of Play in Accounting report. It's clear that they should be treated as key resources during mergers and acquisitions.
Now that you have your new M&A secret weapon, it's time to put it to use! Here are a few tips on how to make the most of this powerful tool: 1.
As the economy continues to evolve, companies need to be proactive in their approach to mergers and acquisitions. One way to do this is to capitalize on the accounting team's expertise. By utilizing their knowledge of the financial landscape, businesses can make informed decisions about potential M&As. This will help to ensure that any future moves are in line with the company's overall goals and objectives.
Accounting teams play an important role in ensuring the financial health of an organization. They can identify and assess risks, recognize losses and impairments, and develop solutions to improve financial reporting and compliance. By simplifying and consolidating entities and reporting structures, they can help improve efficiency and reduce costs.
There are several benefits to having accounting and finance teams work together more closely. One is that it can help improve budgeting and forecasting processes. This, in turn, can lead to better decision-making by increasing communication and financial literacy within an organization.
As your business grows, you may find yourself in need of an M&A secret weapon: an experienced investment banker.
As the economy continues to fluctuate, companies are looking for ways to stay afloat. One solution is to pursue mergers and acquisitions. However, it's not just the business leaders who need to be involved in these initiatives. The finance and accounting teams play a vital role in guiding these initiatives. To ensure finance teams are equipped to support M&As, companies should implement automation as needed, boost education and training, and keep morale high. By taking these steps, companies can help their finance and accounting teams be successful in guiding M&As.
I believe that automating repetitive processes is one of the best ways to support accounting and finance teams. Automated technology can help employees streamline and shorten repetitive processes, which supports a more manageable work-life balance, and focus on more valuable tasks, such as navigating M&As.
There is no question that technology is becoming increasingly important in the workplace. In order to stay ahead of the curve, it is important to make sure that employees are properly trained and able to use existing tools to their full potential. This way, they can focus on being productive and supporting their team, rather than wasting time trying to figure out how to use new software.
When business leaders focus on creating a positive and productive work atmosphere, specifically by reducing stress and burnout and boosting company culture, companies can not only potentially see up to 29% higher profits and 19% higher sales, but also a 72% lower attrition rate. This proves that it is imperative for companies to support their employees in order to create a successful business.
It's time to tap into your M&A secret weapon. With the right tools and strategies in place, you can make your M&A deals more successful. Here's how.
As the global economy faces increasing uncertainty, many businesses are looking to mergers and acquisitions as a way to weather the storm. However, these transitions can be complex and difficult to navigate. That's why it's important to lean on your financial teams during these times. They have the skills and knowledge necessary to help guide your company through these changes and ensure that it remains financially stable.
It's important to remember that your accounting and finance teams are people who need support, especially in a down economy. When you support them, you're benefiting the company.
We might be facing an unstable economy, but one thing is for sure: now is the time to tap into your M&A secret weapons. By taking advantage of the current market conditions and using your M&A experience and knowledge, you can position your company for success. So don't delay - start planning your next move today.
This paragraph is a disclaimer, informing readers that the information provided is not investment, tax or financial advice. Readers are advised to consult with a licensed professional for advice concerning their specific situation.
The Forbes Finance Council is an organization that is dedicated to helping executives in successful accounting, financial planning, and wealth management firms. This organization provides its members with access to resources, networking opportunities, and advice from industry experts. If you are an executive in one of these firms, you may qualify for membership in the council.
