Q1: I’ve imported my data but the graphs look empty!
A: Once you’ve finished importing your data, it is important to make sure that you have correctly setup your mapping. To make sure your mapping is correct:
Q2: What is mapping data?
A: Data Mapping is a process of creating a map between two data models. It allows you to create a logical link between each of your KPIs or financial balance sheet items, for example linking your Revenue within Xero to the Revenue field within Virtual CFO Pro.
Q3: Do I have to import data monthly?
A: Yes, you will need to import your new month’s data each month.
Q4: What does my Z-score mean?
A: The Z-Score was first published by Edward I. Altman (Leonard N. Stern School of Business at New York University) in 1968. Dr Altman researched companies that had gone bankrupt and then tried to develop a formula that would predict if a company was likely to become insolvent. The resultant formula uses a combination of a number of ratios, then weights and combines them into one score.
This has been widely used by professional analysts and has proven to be an excellent indicator.
Note that this should be used as an indicator that further analysis should be done on a company rather than a definite predictor that there is a problem. For instance, companies that have written off assets would appear to have a low score on this scale but be fundamentally sound.
There are two types of Z Scores depending on whether the business is a manufacturing type or non-manufacturing type. The reason being that different types of businesses have different asset turnover rates.
For reference to your score:
For Private Firms:
Z’ > 2.9 -“Safe” Zone
1.23 < Z’ < 2.9 -“Grey” Zone
Z’ < 1.23 -“Distress” Zone For Non-Manufacturing & Emerging Markets Z > 2.6 -“Safe” Zone
1.1 < Z < 2.6 -“Grey” Zone
Z < 1.1 -“Distress” Zone
Q5: How does this link to my KPI Dashboard module?
Once imported and mapped your data is automatically link to the Financial Statement scorecard in the KPI Dashboard.
Q6: What is the what if analysis?
You can use the what if analysis to see what impact small percentage changes can have to your revenue, profit and cash flow. It can be effective in helping stimulate brainstorming sessions to devise possible strategies that could help achieve the what if outcomes.
To download a copy of the linking to xero user manual please click the pdf below.