Analysis of Management in a Problem Loan

TOOL 5.2

Management Structure

1. What is the management structure?
2. What is the makeup of the Managing Board?
3. What is the makeup of the Supervisory Board?
4. Are there any significant outsiders involved in management?
5. Is there a clear chain of command/decision making process?
6. Are job responsibilities clearly defined?
7. Is the organisation centralised or decentralised?
8. Who are the key managers?
9. What are their backgrounds/experience/key skills?
10. Are there managers with experience in finance/marketing /production/sales?
11. Who makes the major decisions?
12. Is there a succession plan?
13. How is performance measured and rewarded?
14. Is management also involved in ownership of the company?
15. Do any senior managers have turnaround skills/experience?

Policy / Planning

1. What is the forum for planning?
2. Who is involved?
3. Is there a strategic plan?
4. Is there a financial plan?
5. How recently were plans made/updated?
6. How has the company performed against those plans (link to Financial analysis)
7. What are the company’s major
   ‒ Strengths
   ‒ Weaknesses
   ‒ Opportunities
   ‒ Threats
8. Does the company use consultants/advisors when in the planning process?
9. Who are the major consultants/advisors?

Information & Systems

1. What are the key factors to be reported on and controlled?
2. Are systems in place to provide that information?
3. What is the quality, frequency and scope of management reporting?
4. Are exceptions reported and acted upon?
5. What controls exist over expenditures, purchasing, investments, disposals etc.?
6. Is there an internal audit function? When does it report, to whom? What are the procedures for following up audit items?