User Story 1:
Precondition: The company has a current ratio of less than 1, indicating a potential liquidity issue.
Post condition: The company improves its current ratio to a healthy level, ensuring short-term solvency.
Potential business benefit: Enhanced ability to meet short-term obligations and maintain financial stability.
Processes impacted: Cash management, accounts payable and receivable, inventory management.
User Story description: As a financial manager, I want to analyze the company’s current ratio to identify any liquidity issues. By calculating the current ratio, I can determine if the company has enough short-term assets to cover its short-term liabilities. This analysis will help me assess the company’s short-term solvency and take necessary actions to improve it.
Key Roles Involved: Financial manager, accounts payable/receivable team, inventory manager.
Data Objects description: Short-term assets, short-term liabilities, current ratio.
Key metrics involved: Current ratio, working capital ratio.
User Story 2:
Precondition: The company has a low quick ratio, indicating potential difficulty in meeting short-term obligations.
Post condition: The company improves its quick ratio, ensuring better short-term solvency.
Potential business benefit: Increased ability to respond to immediate financial needs and maintain liquidity.
Processes impacted: Cash management, accounts receivable, inventory management.
User Story description: As a financial analyst, I want to analyze the company’s quick ratio to assess its ability to meet short-term obligations without relying on inventory. By calculating the quick ratio, I can determine if the company has enough liquid assets to cover its current liabilities. This analysis will help me identify any potential liquidity issues and take necessary measures to improve the quick ratio.
Key Roles Involved: Financial analyst, accounts receivable team, inventory manager.
Data Objects description: Liquid assets, current liabilities, quick ratio.
Key metrics involved: Quick ratio, cash ratio.
User Story 3:
Precondition: The company has a high accounts receivable turnover ratio, indicating potential inefficiencies in collecting outstanding payments.
Post condition: The company improves its accounts receivable turnover ratio, ensuring faster collection of outstanding payments.
Potential business benefit: Improved cash flow and reduced risk of bad debts.
Processes impacted: Accounts receivable management, credit control.
User Story description: As a credit controller, I want to analyze the company’s accounts receivable turnover ratio to assess the efficiency of our credit management process. By calculating the accounts receivable turnover ratio, I can determine how quickly the company collects outstanding payments from customers. This analysis will help me identify any inefficiencies in our credit control process and take necessary actions to improve the accounts receivable turnover ratio.
Key Roles Involved: Credit controller, accounts receivable team.
Data Objects description: Accounts receivable, sales, accounts receivable turnover ratio.
Key metrics involved: Accounts receivable turnover ratio, average collection period.
User Story 4:
Precondition: The company has a high inventory turnover ratio, indicating potential excess inventory or poor sales.
Post condition: The company improves its inventory turnover ratio, ensuring better inventory management and sales performance.
Potential business benefit: Reduced carrying costs and improved cash flow.
Processes impacted: Inventory management, sales forecasting, procurement.
User Story description: As an inventory manager, I want to analyze the company’s inventory turnover ratio to assess the efficiency of our inventory management process. By calculating the inventory turnover ratio, I can determine how quickly the company sells its inventory. This analysis will help me identify any excess inventory or poor sales performance and take necessary actions to improve the inventory turnover ratio.
Key Roles Involved: Inventory manager, sales team, procurement team.
Data Objects description: Inventory, cost of goods sold, inventory turnover ratio.
Key metrics involved: Inventory turnover ratio, days’ sales of inventory.
User Story 5:
Precondition: The company has a low cash ratio, indicating potential cash flow issues.
Post condition: The company improves its cash ratio, ensuring better liquidity and financial stability.
Potential business benefit: Enhanced ability to meet immediate financial obligations and invest in growth opportunities.
Processes impacted: Cash management, budgeting, investment decisions.
User Story description: As a finance director, I want to analyze the company’s cash ratio to assess its ability to cover immediate financial obligations. By calculating the cash ratio, I can determine if the company has enough cash and cash equivalents to cover its current liabilities. This analysis will help me identify any potential cash flow issues and take necessary measures to improve the cash ratio.
Key Roles Involved: Finance director, cash management team, investment manager.
Data Objects description: Cash, cash equivalents, current liabilities, cash ratio.
Key metrics involved: Cash ratio, operating cash flow ratio.
User Story 6:
Precondition: The company has a high debt-to-equity ratio, indicating potential financial risk and reliance on debt financing.
Post condition: The company improves its debt-to-equity ratio, ensuring better financial stability and reduced risk.
Potential business benefit: Increased attractiveness to investors and improved creditworthiness.
Processes impacted: Debt management, equity financing, financial reporting.
User Story description: As a CFO, I want to analyze the company’s debt-to-equity ratio to assess its capital structure and financial risk. By calculating the debt-to-equity ratio, I can determine the proportion of debt and equity financing in the company’s capital structure. This analysis will help me identify any potential financial risks associated with high debt levels and take necessary actions to improve the debt-to-equity ratio.
Key Roles Involved: CFO, debt management team, investor relations.
Data Objects description: Total debt, shareholders’ equity, debt-to-equity ratio.
Key metrics involved: Debt-to-equity ratio, interest coverage ratio.
User Story 7:
Precondition: The company has a low interest coverage ratio, indicating potential difficulty in meeting interest payments.
Post condition: The company improves its interest coverage ratio, ensuring better financial stability and reduced risk of default.
Potential business benefit: Enhanced creditworthiness and reduced borrowing costs.
Processes impacted: Debt management, interest expense forecasting, financial reporting.
User Story description: As a finance manager, I want to analyze the company’s interest coverage ratio to assess its ability to meet interest payments. By calculating the interest coverage ratio, I can determine if the company generates enough operating income to cover its interest expenses. This analysis will help me identify any potential difficulties in meeting interest payments and take necessary measures to improve the interest coverage ratio.
Key Roles Involved: Finance manager, debt management team, financial controller.
Data Objects description: Operating income, interest expenses, interest coverage ratio.
Key metrics involved: Interest coverage ratio, debt service coverage ratio.
User Story 8:
Precondition: The company has a high operating cash flow ratio, indicating potential cash flow surplus.
Post condition: The company maintains a healthy operating cash flow ratio, ensuring efficient cash flow management and financial stability.
Potential business benefit: Increased financial flexibility and ability to invest in growth initiatives.
Processes impacted: Cash management, investment decisions, budgeting.
User Story description: As a financial analyst, I want to analyze the company’s operating cash flow ratio to assess its ability to generate cash from its core operations. By calculating the operating cash flow ratio, I can determine the proportion of operating cash flow to the company’s current liabilities. This analysis will help me identify any potential cash flow surplus or deficit and take necessary actions to maintain a healthy operating cash flow ratio.
Key Roles Involved: Financial analyst, cash management team, investment manager.
Data Objects description: Operating cash flow, current liabilities, operating cash flow ratio.
Key metrics involved: Operating cash flow ratio, cash flow margin.
User Story 9:
Precondition: The company has a low working capital ratio, indicating potential difficulty in meeting short-term obligations.
Post condition: The company improves its working capital ratio, ensuring better short-term solvency and financial stability.
Potential business benefit: Enhanced ability to cover short-term liabilities and reduced risk of insolvency.
Processes impacted: Working capital management, cash flow forecasting, budgeting.
User Story description: As a financial controller, I want to analyze the company’s working capital ratio to assess its ability to meet short-term obligations. By calculating the working capital ratio, I can determine if the company has enough current assets to cover its current liabilities. This analysis will help me identify any potential working capital deficiencies and take necessary measures to improve the working capital ratio.
Key Roles Involved: Financial controller, working capital management team, cash flow analyst.
Data Objects description: Current assets, current liabilities, working capital ratio.
Key metrics involved: Working capital ratio, working capital turnover ratio.
User Story 10:
Precondition: The company has a low cash conversion cycle, indicating potential inefficiencies in managing working capital.
Post condition: The company improves its cash conversion cycle, ensuring better working capital management and financial performance.
Potential business benefit: Reduced cash tied up in working capital and improved profitability.
Processes impacted: Working capital management, inventory management, accounts payable/receivable.
User Story description: As an operations manager, I want to analyze the company’s cash conversion cycle to assess the efficiency of our working capital management. By calculating the cash conversion cycle, I can determine the time it takes for the company to convert its investments in inventory and receivables into cash. This analysis will help me identify any potential inefficiencies in our working capital management process and take necessary actions to improve the cash conversion cycle.
Key Roles Involved: Operations manager, working capital management team, inventory manager.
Data Objects description: Inventory turnover, accounts receivable turnover, accounts payable turnover, cash conversion cycle.
Key metrics involved: Cash conversion cycle, days’ sales outstanding, days’ inventory outstanding, days’ payable outstanding.