Billings are huge. The agency's share is small.
An agency can bill crores in media while keeping only a commission and fees, and its people's time is the real cost. Without time and cost tracking by client, the biggest client can be the least profitable, and media money that passes through can hide a cash problem.
One advertising client valued our help with exactly this kind of complexity:
Their assistance and guidance on some complex accounting transactions, solidifying our internal control structure and the resulting opinions on our financial statements have been invaluable to our business success.
Quoted word for word from our clients. Some quotes use our former name, Soatech.
Follow ₹30 crore of billings through a typical media agency
Here is the cash cycle of an illustrative agency that buys media on behalf of clients:
At ₹30 crore of sales a year, 45 days means about ₹3.7 crore is permanently tied up in the cycle. That is what your bank limit and your own capital are really funding. Collect 15 days sooner and about ₹1.2 crore comes back, with no new loan and no new customer.
Illustrative composite figures, not a client's. Your own cycle comes straight from your balance sheet: stock, receivables and payables, each divided by a day's sales or purchases.
Six money problems specific to agencies
Media paid before clients pay
Media owners' credit is shorter than clients' payment days. We match the two and stop the agency funding clients' media.
Profit by client
Staff time is the main cost. We track time and cost by client and show who really pays off.
Retainers and scope creep
Retainers that keep growing in scope lose money. We track effort against retainer every month.
Complex accounting
Media pass-through, commissions and incentives need careful accounting. We get it right for the audit.
Production projects
Shoots and events need budgets and advance payments. We cost each project and bill milestones.
Concentration risk
A few clients often bring most of the revenue. We track it and plan for the risk.
Want a CFO to look at your numbers?
A senior CFO reviews your figures with you and shows you where to improve. No cost, no obligation.
How we strengthen an agency's finances
Client and project profitability
Fees and commissions less staff time and direct cost.
Media payables against receivables
No campaign funded from the agency's own cash without a decision.
Clean accounting and audit support
Pass-through, commissions and controls done right.
Cash forecasting by campaign
Media dates and client payments, week by week.
Retainer reviews
Scope against fee, every quarter.
Check your own numbers
Compare a full-time finance head's cost with a CFO-led team:
Ask CFOAvatar about your agency
What clients say
Some of the businesses we work with.
Soatech has been an excellent partner to ideasurge for the last five years as our one-stop shop managing Accounts, Audit and Payroll. In addition, they have been instrumental in coordinating with a prior accounting firm and getting us up to date with all regulatory and statutory needs. Soatech now seamlessly operates as an extension of ideasurge for all Finance functions.
They have facilitated us in putting both process and financial systems in place as well as take some very difficult but required decisions. We are indeed pleased to record our appreciation of their individualized, friendly and timely support in our activities during the course of their association.
Quoted word for word from our clients. Some quotes use our former name, Soatech.
Questions owners ask us
How should an agency account for media billing?
It depends on whether the agency acts as principal or agent for the media. The accounting affects reported revenue and margins, so it needs to be decided carefully with your auditor. We set it up correctly.
How do I know which clients are profitable?
Track staff time and direct costs by client, compare them with fees and commissions, and review monthly.
Can you help with audits?
Yes. We strengthen controls, handle complex entries and coordinate with your auditor.
