auditing and consulting business plan

TAG Consultancy PLC

October 242011

TAG Business Consultancy Private Limited Company , business plan

Business Plan

TAG Business Consultancy PLC Business Plan

Executive Summary

TAG Business Consultancy PLC (TAG BC) is in the process of being formed as an ongoing sole proprietorship owned and operated by Abaydar Ketema and Tamene Daba TAG BC. This plan is written as a guide for continuing and managing the business under the new company, and will also serve as the basis for marketing proposals. The two objectives of TAG BC are to generate a profit and to grow at a challenging and manageable rate.

The mission of TAG BC is to provide fast and reliable services in Business Consultancy to small , medium and Large businesses (SMLB), individuals, and other organizations.

The keys to success for TAG BC are: visibility to generate new business leads, networking with other professionals, responsiveness, and quality.

The initial primary service offered will be Accountancy and consultancy service, although specialized fields will be considered in future growth.

The overall objective is to focus the Consultancy and Accountancy activities towards the specialized services (analyses, investigations, startups, etc.) and to become a leader in this niche in the Ethiopia area. The company projects growth to be 10% of sales in the next three years.

The most important keys to success for TAG BC are developing visibility to generate new business leads, strong concentration on relationships with clients, and a high level of quality in our services.

There are a lot of major classes of competition in the Accountancy and Business Consultancy fiduciary business in Ethiopia. These include individual proprietors and small fiduciary and Accounting offices and medium fiduciary offices with between 6 and 25 employees, these offices are available for general financial and tax consulting. There are also large Business Consultancy PLC companies. These companies have several hundred employees. They tend to operate more in the lucrative consulting business. Banks, Assurances and other financial consultants are also new competitors in this field. Banks are now active in start-up consulting, corporate finance, mergers and acquisitions, and others.

Technology is, of course, very important to the success of TAG BC. It is imperative that the company stay up-to-date on technological developments and it will be important to devote a reasonable portion of each year's revenues toward upgrading the equipment and software used in normal operations.

TAG BC will adopt a focused market strategy. Logical segmentation breaks the market down into the following: Individuals, Investors, Small Businesses, Medium Businesses, Large Businesses, and Authorities and Public Organizations. For our

further development, we consider Individual persons and Investors plus Small and Medium Businesses to be crucial.

For our business, we do not have main competitors. We have a lot of widely-sized competitors in a vast market of services.This market environment gives ample opportunity for TAG BC to create and expand a niche in the chosen market fields. Finally, worth noting is the growth trend for the general market, estimated between 5% and 10%, annually.

There are five different major opportunities (needs) in the fiduciary business over the next years:

Bookkeeping and other services related to the operative financial management (payroll, cost-accounting, accounting for pension funds, etc.).

Consulting and special mandates such as financial planning, business evaluation, merger and Acquisition valuation, special audits, etc.

Legal Accountancy and consultancy service (incl. IAS and other standards) as an independent and responsible institution.

Advising clients on general financial and tax consulting.

Providing financial Management training and Investment appraisal

In addition, the company sees three primary market trends which seem to be most important in our business.

Rapid growth in the complexity of business that requires rapid adaptation in the strategy and structures of companies.

More litigation due to higher percentages of unsuccessful ventures.

The growth of outsourced financial consulting.

All of this provides continuing opportunities for a dynamic company such as TAG BC.

We believe our business is in a grand change. The competitors must be generalists and specialists at the same time. For small and medium fiduciary businesses, a focus of one primary segment of business is necessary. For example, if the "core" business is accounting, the other fiduciary businesses like tax, Accountancy and consultancy service, consulting must be reduced to a general level. In the core business, the company must be current with the services, while having the capacity to innovate (like new accounting services related to the Internet).

The company's sales strategy will be based on building long-term customer relationships, which will result in repeat sales. The company estimates that revenues will be approximately $232,000 by Year 3, yielding profits. The company will manage its assets and create profits with no debt financing. It does not anticipate any cash flow problems.

The owners of TAG BC will assume strategic management functions.

1.1 Mission

TAG BC's mission is simple and straightforward:

Purpose - TAG BC exists to provide complete, reliable and high quality services to SMBLs, individuals, lawyers, and authorities. Services must give solutions and results!

Vision - By providing innovative services, TAG BC generates a name in Ethiopia and the surrounding area.

1.2 Keys to Success

The keys to success for TAG BC are:

Developing visibility to generate new business leads.

Relationships with clients (developing loyal, respectful, and intensive contact with both clients and potential clients).

Marketing/strategy and networking with other professionals.

Collaboration with Other professional service provider for generally fiduciary services and IT services.

Responsiveness to clients (fast response time for special problems).

Quality (especially in reporting information).

Excellence in fulfilling the promise.

Openness: languages and willpower for creating interregional and international contacts.

1.3 Objectives

The objectives of this business plan are:

1. To provide a written guide for managing this business; a strategic framework for developing a comprehensive tactical marketing philosophy.

2. This plan is not intended to obtain financing; it is purely for internal improvements.

3. The scope of this plan is to provide detailed monthly projections for the current plan year, as well as yearly summaries for the following two years.

The objectives of TAG Accountancy, consultancy service & Consulting are:

1. The overall objective is to focus the activities towards the specialized services (analyses, investigations, startups, etc.) and to become a leader in this niche in the Ethiopia area.

2. Cash flow - To generate sufficient cash flow to finance future growth and development and to provide the resources needed to achieve the other objectives of the company and its owners.

3. Growth - To expand the business at a rate that is both challenging and manageable, serving the market with innovation and adaptability. (Growth projected at 10% of sales in the next three years.)

Company Summary

TAG BC will be an ongoing company established by Abaydar Ketema and Tamene Daba with the following characteristics:

The goal will be to continue the activities on a larger personal and organizational basis, still with no debt financing.

TAG BC will assume operations of one of the other professional service provider's divisions.

2.1 Company History

This Company has established newly with very rich experienced individuals in Business profession.

Before starting this business company, Abaydar Ketema and Tamene Daba TAG acquired extensive professional experience as listed below:

4 years in EEPCo As an accountant and Auditor, Ethiopia.

7 years In World Vision Ethiopia as Finance and Administration Manager, Ethiopia

2.2 Company Ownership

TAG Business Consultancy PLC will be incorporated in the city of Addis Ababa, Ethiopia by Abaydar Ketema and Tamene Daba , who will be the sole owner.

2.3 Company Locations and Facilities

TAG BC is established in Addis Ababa, in Ethiopia. Secretary and telephone response is assumed by the company itself based on the appropriate office In the ________ building, on the first level, is established ATO Geistesblitz (sale and consulting of SMB software sage-KHK).

Services

TAG BC will be the number one company in the Ethiopia area for specialized and investigative services in the modern business environment. TAG BC also offers classic, Accountancy and consultancy service, and general consulting services.

TAG BC will offer three main services - Accountancy and consultancy service, tax Consulting, and other financial management training and business appraisal Investigation.

There appear to be four main classes of competition, as indicated under section 3.2.

Fulfillment of services will be provided in the future by Abaydar Ketema and Tamene Daba and other equally qualified professionals.

It's important to be current with the classic and special business software.

Detailed descriptions of these points are found in the sections below.

3.1 Service Description

TAG Business Consultancy PLC offers three main services:

1. Accountancy and consultancy service - Financial data must be checked and confirmed, we consider this normal, as a service related to Accountancy and consultancy service. Most of these services are legal Accountancy service in the sense of Ethiopian General Auditor law. A legal General Accountancy service is the most comprehensive assessment of the presentation of financial data. By contrast, a Review is generally prepared for the assurance of the management and as a minimum requirement of financial institutions for the purpose of extending credit. Finally an Analysis is limited on the plausibility and the ratios. An Analysis is normally based on reviewed financial data documents.

An essential part of all Accountancy and Consulting service activities understands the business environment in which a company operates and to evaluate the risks of financial losses.

2. Consulting - Includes business planning, business evaluation, merger and acquisition, start-up planning, restructuring, and business-succession

planning, tax consulting, business appraisal, Financial Management training etc.

3. Investigation - Our Accountancy and consultancy service and business expertise provides us with the ability to perform analysis, specialized accounting, and valuation of businesses in business disputes, fraud, or other cases of incertitude and disputes.

3.2 Competitive Comparison

There seems to be four major classes of competition in the actual fiduciary business in Ethiopia:

1. Individual proprietors and small fiduciary and Accounting offices. The primary business of these competitors is Accounting and tax compliance (for individuals and companies). These offices normally employ between 1 and 5 people. These offices deal in a large spectrum on a general level, but without specialization.

2. Medium fiduciary offices with between 6 and 25 or more employees. These offices are also dealing in a large and general spectrum. If there are several partners--with different formation and specialties--these offices are available for general financial and tax consulting.

3. Large TAG Business Consultancy PLC companies. These companies have several hundred employees. They tend to operate more in the lucrative consulting business. Large companies are normally not interested in dealing with small and medium business. All large companies have an international network.

4. Banks, Assurances and other Financial Consultants are new competitors. Financial services are "in." Banks are active in start-up consulting, corporate finance, mergers and acquisitions, and others.

3.3 Fulfillment

The fulfillment of services will be provided by the owner themself. The ultimate delivery was the owner's expertise and problem solving capability, coupled with an open mind and ease of communication. The end result is an established trust with complete customer confidence and satisfaction.

In the future, the clients must also accept the work of other qualified personnel--it is necessary to transfer and expand the established personal goodwill into company goodwill. This will only be possible with qualified and motivated employees.

3.4 Technology

Technology is, of course, very important to the success of TAG Accountancy and consultancy service & Consulting. It is imperative that the company stay up-to-date

on the technological developments in the classic business software like MS-Office, etc. as well as in the special software and tools for Accountancy and consultancy service, financial planning, business planning, etc.

In addition, it will be important to devote a reasonable portion of each year's revenues toward upgrading the equipment and software used by TAG BC in its normal operations.

Market Analysis Summary

TAG Business Consultancy PLC will adopt a focused market strategy.

Logical segmentation breaks the market down into the following: Individuals, Investors, Small Businesses, Medium Businesses, Large Businesses, and Authorities and Public Organizations. Descriptions are provided below.

The largest and most logical target markets for TAG BC at the present are small ,medium and large businesses. In a new "Financial Industry" Individuals and Investors become an important market segment.

For our business, we do not have main competitors. We have a lot of widely-sized competitors in a vast market of services. This market environment gives ample opportunity for TAG BC to create and expand a niche in the chosen market fields.

Finally, worth noting is the growth trend for the general market, estimated between 5% and 10%, annually.

4.1 Market Segmentation

The following chart and table reflect the estimated market segmentation and growth for this business.

Individual persons and Investors

Small Businesses - Defined as businesses with 1 to 24 employees, this is the second largest and fastest growing segment in our region.

Medium Businesses - 25 to 499 employees.

Large Businesses - 500 or more employees.

Authorities and Public Organizations

Market Analysis

2012 2013 2014 2015 2016

Potential Customers

Growth CAGR

Individuals and Investors

20% 3 4 5 6 7 23.59%

Small Businesses 10% 20 22 24 26 29 9.73%

Medium Businesses 10% 33 36 40 44 48 9.82%

Large Businesses 5% 34 36 38 40 42 5.42%

Authorities and Public Organisations

5% 10 11 12 13 14 8.78%

Total 8.78% 100 109 119 129 140 8.78%

4.2 Target Market Segment Strategy

For our further development, we consider the following market segments to be very important:

Individual persons and Investors.

Small and Medium Businesses.

TAG BC will focus its marketing strategy primarily on these market segments.

4.2.1 Market Needs

There are three different major opportunities (needs) in the fiduciary business over the next years:

1. Bookkeeping and other services related to the operative financial management (payroll, cost-Accounting, accounting for pension funds, etc.).

2. Consulting and special mandates.

o Financial-Planning

o Business-Planning

o Business-Evaluation

o Merger & Acquisition

o Startup-Planning

o Restructuring

o Business Succession-Planning

o Coaching in Financial-Managing

o Recovery

o Special investigation, Reviews

o Analyses

o Other

3. Legal Accountancy and consultancy service (incl. IAS and other standards) as an independent and responsible institution.

We think that the need for consulting and other specialized fields has a strong growth potential.

4.2.2 Market Trends

Three primary market trends seem to be most important in our business:

Trend 1- (most important) Rapid growth in complexity of business in an ever-changing market and competitive environment needs continuous and rapid adaptation in both strategy and structures of companies.

Trend 2- (moderately important) In the future there will be a percentage of unsuccessful ventures resulting in more litigation, which, in turn, will emphasize the need for specialized Accounting, investigation, restructuring, etc.

Trend 3- (least important) Predicted continued growth in consulting because companies will be unwilling to pay fixed costs of salaries, choosing instead to treat specialized financial knowledge and needs as variable costs from external sources.

Economically it is more expedient to acquire specialized services from a consulting firm that has its own specialized employees.

4.2.3 Market Growth

As noted in the previous section, several factors are predicted to continue well into the next decade, not the least of which we estimate the annual market growth rate between 5% and 10%.

4.3 Service Business Analysis

The fiduciary and consulting business for the local area is already well established, yet still allows ample opportunity for us. This is supported by the following points:

Already in existence are a large number of firms - we think that most of the small and medium firms are operating in a limited spectrum of traditional fiduciary services (accounting and tax) and they do not have enough knowledge and/or time for entering the field of specialized services - so we have new participants like banks, assurances, lawyers, and others entering the market.

Customers in the fiduciary business tend to be loyal, relying on the same consultant for future needs once a relationship has been established - this fact requires establishing a good and intensive personal relationship with client.

The globalization of markets will increase the demands for expansion of new services related to our business.

We believe our business is in a in a period of grand change. The competitors must be generalists and specialists at the same time. For small and medium fiduciary businesses, a focus of one primary segment of business is necessary. For example, if the "core" business is accounting, the other fiduciary businesses like tax, Accountancy and consultancy service, consulting must be reduced to a general level. In the core business, the company must be current with the services, while having the capacity to innovate (like new accounting services related to the Internet).

For our business, we do not have main competitors: We have many competitors in diversified services. More important than the competitors, is the need to get established in the right market and to develop this market with a strong and flexible strategy.

4.3.1 Competition and Buying Patterns

Competition in the general field of business consulting in the Ethiopia area is quite intense. Although numerous established companies offer a variety of services to different customer segments, TAG Business Consultancy PLC considers competition in our focus market niche of small and medium businesses to be modest. Customers in this segment strongly rely on the consultant's professional qualifications and the ability to come up with viable solutions in a time- and cost-effective manner.

Strategy and Implementation Summary

TAG BC will offer Accountancy and consultancy service, consulting, and investigation services to small, medium and large businesses in the Ethiopia area. The company will focus on providing excellent customer service, and that will generate favorable client referrals and increase customer retention.

5.1 Competitive Edge

TAG Accountancy and consultancy service & consulting competitive edge are in the well-established reputation of Abaydar Ketema and Tamene Daba. Combining professional expertise with the financial, marketing, and technical support of other professional service provider, the company is positioned to further entrench itself in the growing market of small and medium business consulting in the Ethiopia area.

5.2 Sales Strategy

The company's sales strategy will be based on building long-term customer relationships, which will result in repeat sales. Customer service and 'face time' with clients will be aimed to maintain a high level of customer retention. The charts and table below outline the Sales Forecast for the next three years.

Sales Forecast

2012 2013 2014

Sales

Accountancy services $80,492 $96,590 $115,908

Consulting services $48,291 $57,949 $69,539

Investigation services $32,194 $38,633 $46,359

Total Sales $160,977 $193,172 $231,807

Direct Cost of Sales 2003 2004 2005

Accountancy services $12,077 $13,889 $15,972

Consulting services $7,243 $8,329 $9,579

Investigation services $6,438 $7,404 $8,514

Subtotal Direct Cost of Sales $25,758 $29,622 $34,065

Management Summary

Abaydar Ketema and Tamene Daba , the Sole owner of TAG BC, will assume strategic management functions..

6.1 Personnel Plan

The following table outlines the two-person management system of TAG BC.

Personnel Plan

2012 2013 2014

Abaydar Ketema $48,000 $51,000 $56,000

Tamene Daba $24,000 $26,000 $30,000

Total People 2 2 2

Total Payroll $72,000 $77,000 $86,000

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

2012 2013 2014

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 35.00% 35.00% 35.00%

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, TAG 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.

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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.

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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

BCcounts 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

BCcumulated 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

BCcounts 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

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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 - Accontancy and consultancy service services, are shown for comparison.

Ratio Analysis

2003 2004 2005Industry Profile

Sales Growth -0.72% 20.00% 20.00% 8.60%

Percent of Total Assets

BCcounts 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

BCtivity Ratios

BCcounts Receivable Turnover 7.07 7.07 7.07 n.a

Collection Days 59 47 47 n.a

BCcounts 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

BCid Test 19.15 20.47 24.43 n.a

Sales/Net Worth 1.28 1.15 1.03 n.a

Dividend Payout

TAG Business Consultancy PLC Business Plan

TAG Business Consulyancy PLC

Appendix

Sales Forecast

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Sales

Audit services

0%

$4,343

$5,791

$5,791

$5,791

$7,238

$9,844

$8,686

$9,844

$5,791

$5,791

$5,791

$5,791

Consulting services

0%

$2,606

$3,474

$3,474

$3,474

$4,343

$5,906

$5,212

$5,906

$3,474

$3,474

$3,474

$3,474

Investigation services

0%

$1,737

$2,316

$2,316

$2,316

$2,895

$3,938

$3,474

$3,938

$2,316

$2,316

$2,316

$2,316

Total Sales

$8,686

$11,581

$11,581

$11,581

$14,476

$19,688

$17,372

$19,688

$11,581

$11,581

$11,581

$11,581

Direct Cost of Sales


Audit services

$651

$869 $869 $869 $1,086

$1,477

$1,303

$1,477

$869 $869 $869 $869

Consulting services

$391

$521 $521 $521 $651 $886 $782 $886 $521 $521 $521 $521

Investigation services

$347

$463 $463 $463 $579 $788 $695 $788 $463 $463 $463 $463

Subtotal Direct Cost of Sales

$1,389

$1,853

$1,853

$1,853

$2,316

$3,151

$2,780

$3,151

$1,853

$1,853

$1,853

$1,853



Personnel Plan


Abaydar Ketema and Tamene Daba TAG

0%

$4,000

$4,000

$4,000

$4,000

$4,000

$4,000

$4,000

$4,000

$4,000

$4,000

$4,000

$4,000

Brigitte TAG

0%

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

Total People

2 2 2 2 2 2 2 2 2 2 2 2

Total Payroll

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

General Assumptions


Plan Month

1 2 3 4 5 6 7 8 9 10 11 12

Current Interest Rate

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

Long-term Interest Rate

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

Tax Rate

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

Other 0 0 0 0 0 0 0 0 0 0 0 0

Pro Forma Profit and Loss


Sales$8,686

$11,581

$11,581

$11,581

$14,476

$19,688

$17,372

$19,688

$11,581

$11,581

$11,581

$11,581

Direct Cost of Sales

$1,389

$1,853

$1,853

$1,853

$2,316

$3,151

$2,780

$3,151

$1,853

$1,853

$1,853

$1,853

Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Cost of Sales

$1,389

$1,853

$1,853

$1,853

$2,316

$3,151

$2,780

$3,151

$1,853

$1,853

$1,853

$1,853

Gross Margin

$7,297

$9,728

$9,728

$9,728

$12,160

$16,537

$14,592

$16,537

$9,728

$9,728

$9,728

$9,728

Gross Margin %

84.01%

84.00%

84.00%

84.00%

84.00%

84.00%

84.00%

84.00%

84.00%

84.00%

84.00%

84.00%

Expenses

Payroll$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

Sales and Marketing and Other Expenses

$400

$590 $590 $590 $590 $599 $590 $590 $590 $590 $590 $590

Depreciation

$200

$200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200

Leased Equipment (incl. office rental)

$200

$200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200

Utilities (incl. office furniture, etc.)

$150

$150 $150 $150 $150 $150 $150 $150 $150 $150 $150 $150

Insurance

$100

$100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100

Rent $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Payroll Taxes

16%

$960

$960 $960 $960 $960 $960 $960 $960 $960 $960 $960 $960

Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Operating Expenses

$8,010

$8,200

$8,200

$8,200

$8,200

$8,209

$8,200

$8,200

$8,200

$8,200

$8,200

$8,200

Profit Before Interest and Taxes

($713)

$1,528

$1,528

$1,528

$3,961

$8,329

$6,393

$8,338

$1,529

$1,528

$1,528

$1,528

EBITDA($513)

$1,728

$1,728

$1,728

$4,161

$8,529

$6,593

$8,538

$1,729

$1,728

$1,728

$1,728

Interest Expense

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Taxes Incurred

($178)

$382 $382 $382 $990 $2,082

$1,598

$2,084

$382 $382 $382 $382

Net Profit

($535)

$1,146

$1,146

$1,146

$2,970

$6,246

$4,794

$6,253

$1,146

$1,146

$1,146

$1,146

Net Profit/Sales

-6.16%

9.90%

9.90%

9.90%

20.52%

31.73%

27.60%

31.76%

9.90%

9.90%

9.90%

9.90%

Pro Forma Cash Flow


Cash Received

Cash from Operations

Cash Sales

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Cash from Receivables

$5,791

$6,080

$8,783

$11,581

$11,581

$11,678

$14,650

$19,611

$17,449

$19,418

$11,581

$11,581

Subtotal Cash from Operations

$5,791

$6,080

$8,783

$11,581

$11,581

$11,678

$14,650

$19,611

$17,449

$19,418

$11,581

$11,581

Additional Cash Receive

d

Sales Tax, VAT, HST/GST Received

0.00%

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

New Current Borrowing

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

New Other Liabilities (interest-free)

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

New Long-term Liabilities

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Sales of Other Current Assets

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Sales of Long-term Assets

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

New Investment

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Received

Subtotal Cash Received

$5,791

$6,080

$8,783

$11,581

$11,581

$11,678

$14,650

$19,611

$17,449

$19,418

$11,581

$11,581

Expenditures


Expenditures from Operations

Cash Spending

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

Bill Payments

$11,682

$3,061

$4,235

$4,235

$4,271

$5,370

$7,213

$6,406

$7,135

$4,235

$4,235

$4,235

Subtotal Spent on Operations

$17,682

$9,061

$10,235

$10,235

$10,271

$11,370

$13,213

$12,406

$13,135

$10,235

$10,235

$10,235

Additional Cash Spent

Sales Tax, VAT, HST/GST

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Paid Out

Principal Repayment of Current Borrowing

$2,895

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other Liabilities Principal Repayment

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Long-term Liabilities Principal Repayment

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Purchase Other Current Assets

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Purchase Long-term Assets

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal Cash Spent

$22,577

$11,061

$12,235

$12,235

$12,271

$13,370

$15,213

$14,406

$15,135

$12,235

$12,235

$12,235

Net Cash Flow

($16,786)

($4,981)

($3,453)

($654)

($690)

($1,693)

($563)

$5,205

$2,314

$7,183

($654)

($654)

Cash Balance

$75,865

$70,884

$67,431

$66,777

$66,087

$64,395

$63,832

$69,036

$71,351

$78,534

$77,880

$77,226



Pro Forma Balance Sheet


Assets

Starting Balances

Current Assets

Cash $92,651

$75,865

$70,884

$67,431

$66,777

$66,087

$64,395

$63,832

$69,036

$71,351

$78,534

$77,880

$77,226

BCcounts Receivable

$11,581

$14,477

$19,977

$22,776

$22,776

$25,671

$33,681

$36,404

$36,481

$30,613

$22,776

$22,776

$22,776

Other Current Assets

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

$1,158

Total Current

$105,390

$91,499

$92,019

$91,365

$90,711

$92,916

$99,234

$101,393

$106,675

$103,121

$102,468

$101,814

$101

Assets ,160

Long-term Assets

Long-term Assets

$6,948

$8,948

$10,948

$12,948

$14,948

$16,948

$18,948

$20,948

$22,948

$24,948

$26,948

$28,948

$30,948

BCcumulated Depreciation

$0 $200 $400 $600 $800 $1,000

$1,200

$1,400

$1,600

$1,800

$2,000

$2,200

$2,400

Total Long-term Assets

$6,948

$8,748

$10,548

$12,348

$14,148

$15,948

$17,748

$19,548

$21,348

$23,148

$24,948

$26,748

$28,548

Total Assets

$112,338

$100,247

$102,567

$103,713

$104,859

$108,864

$116,982

$120,941

$128,023

$126,269

$127,416

$128,562

$129,708

Liabilities and Capital


Current Liabilities

BCcounts Payable

$11,581

$2,920

$4,094

$4,094

$4,094

$5,129

$7,000

$6,165

$6,994

$4,093

$4,094

$4,094

$4,094

Current Borrowing

$2,895 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Current Liabilities

Subtotal Current Liabilities

$14,476

$2,920

$4,094

$4,094

$4,094

$5,129

$7,000

$6,165

$6,994

$4,093

$4,094

$4,094

$4,094

Long-term Liabilities

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Liabilities

$14,476

$2,920

$4,094

$4,094

$4,094

$5,129

$7,000

$6,165

$6,994

$4,093

$4,094

$4,094

$4,094

Paid-in Capital

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

$5,000

Retained Earnings

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

$92,862

Earnings $0 ($535)

$611 $1,757

$2,903

$5,874

$12,120

$16,914

$23,168

$24,314

$25,460

$26,606

$27,752

Total Capital

$97,862

$97,327

$98,473

$99,619

$100,765

$103,736

$109,982

$114,776

$121,030

$122,176

$123,322

$124,468

$125,614

Total Liabilities and Capital

$112,338

$100,247

$102,567

$103,713

$104,859

$108,864

$116,982

$120,941

$128,023

$126,269

$127,416

$128,562

$129,708

Net Worth

auditing and consulting business plan

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