Chapter Eight Accounting: Decision Making by the Numbers Video Case: B2B CFO and Hosco Finishing Systems Components B2B CFO works with small and medium-sized companies to help them attain a clearer picture of their goals and finances. For companies unable to afford a full-time chief financial officer, B2B CFO is the ideal solution. With over twenty years of experience, the founder and CEO, Jerry Mills, has steadily built the largest supplier of temporary CFOs, helping growing companies understand the intricacies of the financial world. Jerry Mills says that some business owners are uable to achieve clarity in terms of cash flow and some do not want to, and that is when they need a "financial doctor" Sheri Pawlik, who works for B2B CFO, says that the services offered by B2B CFO include spotting the drivers of profitability for a company. She believes that it is imperative for a firm's CEO to understand financial statements as it will help them successfully land an investor or a lender in the future. One such company that B2B CFO works with is Hosco Finishing System Components, a company that finds solutions for the paint delivery industry. The President, Tom Murray, having previously worked for Ford Motor Company, eventually found himself at ITW. another large multinational. The latter divested Hosco when it ceased to be compatible with TW's core priorities. B2B CFO helped Tom Murray kick-start his new career as the owner of Hosco. Since the purchase, he has been successfully running the company, which employs about ten people at its facility at Livonia, Michigan. Hosco Fittings manufactures stainless-steel cavity-free smooth board fittings, and hosing and tubing accessories used in fluid handling systems for paint coatings and other materials. When Tom Murray engaged the services of Sheri Pawlik to manage his finances, she developed financial projections that he took to the banks to buy Hosco from ITW. On a monthly basis, she reviews the company's financial statements, key metrics, and income statements. The income statements show top-line sales, revenues, and expenses, which indicate whether the company is making or losing money. She says that the balance sheet tells the owner what they own and how much of it they own with their own money and how much of it with somebody else's. Sheri Pawlik believes that 101 books are not going to help an entrepreneur stay on the path to financial success, she says they need to understand cash." Tom Murray says that it is a solid operating cash flow that will keep the company well above water, with enough to pay banks, taxes, and make payroll According to Jary Mills, nearly 90 per cent of "business geniuses" are not interested in cash flow. The entrepreneurs rather expect all of it to come together, and are more than willing to let set someone else deal with the nitty-gritties of finances. This is what B2B CFO and Sheri Pawlik do make dreams come true today and help companies confidently look toward a sustainable future Directions Chapter Video Case Questions: - A A A A 11111111111211 23 51 III 116 1. The video case file assignments have 3 critical thinking questions at the end of the case file 2. Read the case file carefully and watch the video as many times as necessary before you answer the questions. The video files at the Cengage Publishing CourseMate Web Site: www.cengageain.com and requires you to enter your Access Code from your NEW textbook Video narratives and questions may be found in your textbook. 3. Answer each question using complete and comprehensive sentences using proper grammar. Each question is worth 3.33 points for a total of 10 points and should contain 50 words for full credit. Critical Thinking Questions Using information from the case and the video, answer the following questions: 1. What are the advantages of hiring a temporary CFO for small and medium-sized businesses? 2. How does B2B CFO help companies like Hosco get capital from financial institutions in order to survive? 3. Explain how firms like B2B CFO that offer temporary financial management services aid small and medium-sized businesses