Orbital, engaged at the behest of both the authorizer and bond holders, successfully turned around a financially troubled charter school group. While the school had done well academically, they were struggling financially and had consistently failed to meet their debt covenants. Net assets had fallen to negative $2.2M. Days cash-on-hand was below 5 and payables had ballooned to just under $1M (over 10% of their annual expenses).
Orbital, acting as the temporary CFO/COO, stabilized cash, negotiated settlements to outstanding payables which alone reduced payables by half. Contracts were rebid and/or vetted anew. A budget will developed from both the top down and bottom up such that critical financial metrics were maintained while preserving the autonomy of the leadership team in delivering maintaining their academic model. Within 6 months payables were reduced to under $400K and net assets improved to negative $1.5M.
Orbital installed policies and procedures to regulate expenditures while at the same time installing accountability into the management team. Orbital repaired the G/L to correctly state the organization's true financial position.