Through July 24 the weekly flash showed revenue of $79.9k against $70.9k of cost — a $9.0k operating profit. In the last seven days COGS rose $18.7k and operating expenses rose $16.0k against only $4.2k of additional revenue, closing the month at a $21.5k operating loss. The flash reports named the cause each week: contractor project work was not being recognised in the period it was incurred.
This is a cut-off problem, not a new cost. Until it is fixed, every in-month report overstates profit and the month-end result arrives as a surprise.
July was budgeted to lose $12,894. Three variances took it to a $21,518 loss — and cost overruns account for 77% of the gap, not the revenue shortfall.
Derived from year-to-date less July. The budget already assumed a slow July — but revenue still came in 26% below the Jan–Jun run rate while operating expenses ran 22% above it.
Ranked by dollar impact on operating income. Revenue lines are excluded — they appear in the revenue table below.
Underspend partly offset the overruns. Several of these are timing rather than true savings.
The total revenue miss was only $1,948, but the mix moved a long way. Website & Design came in at 60% of budget (–$9,919) while Marketing & Advertising (+$6,261) and Branding & Identity (+$4,700) covered most of the gap. Website work is the higher-margin line, which is part of why gross margin fell.
Cumulative figures from the four weekly flash reports plus the closed month. Operating income is calculated as revenue less COGS less operating expenses on each report, so the line is internally consistent.
$12,005 sits across all five accounts — and the primary operating account, Chase Checking, is overdrawn by $6,244. July's operating cost was $105,640, or $3,408 a day. Current liabilities of $638,383 stand against current assets of $105,403, a current ratio of 0.17.
The business is being funded by its vendors and its owner: accounts payable of $263,381 is roughly 85 days of total spend, and $119,368 is owed to Heather Porter personally.
Every liquid resource the business has — cash plus the full receivable ledger — totals $101,169. Near-term obligations total $601,772. Even collecting 100% of AR tomorrow closes only 17% of the gap.
Per the weekly flash reports. The account went negative on July 17 and closed the month at $12,005 — the highest point of the month, but still under four days of cover.
Cumulative cash collected during July against the balance still outstanding from May onward, as reported weekly. Collections improved through the month; the outstanding balance fell from $83k to $60k. Reconcile to $89,164 AR
Six cards. Interest expense of $1,162 was recorded in July against a $3,500 budget — a third of plan, which suggests some finance charges have not yet posted. Rates and minimums needed
The Byline line of credit is the largest single facility and sits in current liabilities. The shareholder loan is the second largest source of funding in the business.
$24,846 of the balance sheet is money received for work not yet delivered — customer deposits, client advertising deposits and deferred subscription revenue. That is more than twice the cash in the bank.
1 · Collect. $89,164 of AR is the only self-funded cash available. The flash reports indicate roughly $60k of it has been outstanding since May or earlier. An aging report and a named owner per invoice is the fastest single move.
2 · Restructure payables. At 85 days, AP is already functioning as the company's credit line. A vendor-by-vendor plan converts an uncontrolled position into a scheduled one before a key supplier stops work.
3 · Fix the contractor cut-off. The $7,690 COGS contractor line ran at 321% of budget and arrived after month end. Accruing it weekly makes the flash report a decision tool rather than a lagging summary.
The Sankey circulated with the July flash report shows net income of +$25,518 flowing out of gross profit. July was a loss of $21,518. All expense nodes on that diagram tie to the P&L exactly; only the net income node is wrong. The version below is rebuilt from the closed ledger — gross profit of $45,763 does not cover $67,282 of operating expense, and the shortfall is shown as an inflow because it was funded by payables and debt, not by earnings.
Revenue of $84,122 in from six service lines; $38,358 consumed by cost of sales; $67,282 of operating expense out. The red band is the $21,518 operating loss — the amount funded from outside the month's earnings.
Condensed. Percentages are of revenue.
Condensed. Percentages are of revenue.
Seven months in, revenue is $762,452 at a 65.6% gross margin with operating income of $101,915. Reported net income of $148,274 includes a one-off $62,320 ERC refund and a $17,000 miscellaneous expense; excluding both, net income is $102,954. The problem is not that the business does not make money — it is that a profitable P&L has produced a balance sheet with $12k of cash, and July shows the operating model slipping as well.
Figures marked ◇ elsewhere in this dashboard depend on the answers below. Nothing here changes the closed July result, but several items change how it should be read.