Commercial Finance
Commercial finance is focused on forward-looking activities that support your growth strategy.
The three main financial statements are the income statement, balance sheet, and cash flow statement, which respectively provide an overview of a businesses's profitability, financial position, and liquidity.
📄️ Capital Allocation
What projects are most important to prioritise for what reasons?
📄️ Cashing Out
How does traditional path vary to Web3?
📄️ Fundraising
What is the best strategy to raise to use AI and Web3 to fund business experiments?
📄️ Treasury
Treasury operations are a strong candidate to be replaced by a DAO.
The three main financial statements are the income statement, balance sheet, and cash flow statement, which respectively provide an overview of a businesses's profitability, financial position, and liquidity.
Operating cash flow indicates whether a company can generate sufficient positive cash flow to engineer a stronger platform to expand into new opportunities.
Key financial ratios to monitor include the Gross Profit Margin (measures profitability relative to costs), Current Ratio (indicates liquidity), and Return on Investment (ROI, indicates return generated from investments).
Regular review of these financial statements and ratios enables business owners and managers to identify areas of strong performance and those needing improvement, allowing for more informed decisions about budgeting, resource allocation, and investments. Overall, effective financial reporting provides valuable insights into a business's financial health, aiding in decision-making for future growth and sustainability
Commercial vs Compliance
For key financial workflows see table of commercial vs compliance activities.
| Business Procedure | Commercial Focus | Compliance Focus |
|---|---|---|
| Budgeting and Forecasting | Preparing budgets, forecasting revenues and expenses | Ensuring budgeting and forecasting processes comply with accounting standards |
| Financial Reporting | Preparing internal financial reports for management decision-making | Preparing financial statements in compliance with accounting standards for external stakeholders |
| Financial Analysis | Analyzing financial performance and identifying trends | Ensuring accounting systems and records are accurate and complete |
| Strategic Planning | Participating in strategic planning and decision-making | Providing input on compliance issues related to strategic plans |
| Capital Structure Management | Managing the company's debt and equity mix, investment decisions | Ensuring capital structure decisions comply with relevant laws and regulations |
| Risk Management | Identifying and managing financial risks | Implementing internal controls to mitigate financial and compliance risks |
| Transactional Activities | Managing cash flow, receivables, payables | Ensuring transactions are recorded accurately and timely, in compliance with accounting standards |
Accounting compliance is more about ensuring the company meets its obligations under accounting standards and regulations.