Build recommendation logic with implementation and follow-up actions.
Recommendation logic is the bridge between analysis and action. A Day 2 answer can identify the right issue and perform useful analysis, but still lose strength if the recommendation is vague, unsupported, infeasible, or disconnected from the declared role.
The recommendation should follow from the analysis. It should state what should be done, why, by whom or under what condition when relevant, and what follow-up is needed.
This lesson focuses on writing recommendations that are supported by role-depth analysis and practical enough for the decision maker.
| Recommendation element | Purpose |
|---|---|
| Action | States what should be recorded, tested, corrected, approved, financed, disclosed, or implemented. |
| Reason | Links the action to case evidence and analysis. |
| Condition | Explains the assumption, approval, financing, evidence, or threshold that affects the action. |
| Owner | Identifies who should perform, approve, monitor, or escalate when useful. |
| Follow-up | States documentation, procedure, communication, monitoring, or further work needed. |
Not every recommendation needs every element, but major Day 2 issues usually need more than a bare conclusion.
A conclusion states what the analysis means. A recommendation states what should happen. Day 2 answers often need both.
| Conclusion only | Stronger recommendation |
|---|---|
| “Revenue should be deferred.” | “Defer revenue until delivery occurs, adjust receivables and profit, and inform the lender if the adjustment affects covenants.” |
| “The project is risky.” | “Do not proceed until financing is confirmed and the downside cash forecast still meets covenant limits.” |
| “The tax position is uncertain.” | “Obtain support for the deduction before filing and disclose the cash-tax effect in the recommendation.” |
| “The control is weak.” | “Separate approval and recording duties, and have the controller review exceptions monthly.” |
The stronger version is actionable.
Recommendation logic should be visible. The reader should see why the action follows from the facts. A useful sequence is:
For example: “Because the forecast assumes a sales increase that exceeds current capacity, the expansion should be staged. Management should approve phase one only after hiring and financing milestones are met.” This recommendation links fact, analysis, action, and condition.
Implementation turns a recommendation into a plan that can be used. Day 2 recommendations should not become full project plans, but they should identify critical follow-up when feasibility matters.
| Issue type | Useful follow-up |
|---|---|
| Reporting correction | Journal entry, disclosure, documentation, covenant communication, or management approval. |
| Assurance risk | Procedure, evidence source, specialist support, report implication, or communication to governance. |
| Tax issue | Filing correction, documentation, tax advice, payment plan, or support for position. |
| Finance decision | Cash forecast, lender consent, covenant calculation, financing approval, or sensitivity analysis. |
| Performance issue | KPI revision, owner assignment, monitoring schedule, control change, or training. |
| Strategy issue | Board approval, staged rollout, milestone reporting, stakeholder communication, or risk threshold. |
Follow-up should address the fact that could otherwise make the recommendation fail.
Conditions are useful when they make a recommendation accurate. They should not be used to avoid judgment. “Proceed if financing is approved and cash coverage remains above the required threshold” is useful. “Proceed if everything works out” is not.
Good conditions identify the specific uncertainty:
| Weak caveat | Better condition |
|---|---|
| “More information is needed.” | “Confirm the lease cancellation clause before finalizing the buy-versus-lease recommendation.” |
| “Assuming management is right.” | “If signed customer contracts support the volume forecast, proceed with phase one.” |
| “Subject to tax review.” | “Obtain support for fair value and related-party terms before filing.” |
| “If the bank agrees.” | “Obtain written covenant waiver before committing to the debt-funded purchase.” |
Recommendations should match the intended reader. A board may need governance and risk monitoring. Management may need implementation steps. A partner may need evidence, reporting, and professional implications. An owner-manager may need cash, tax, and feasibility effects. Use the role instructions to decide which emphasis belongs.
Use this sequence:
| Pitfall | Correction |
|---|---|
| Ending with analysis but no action. | State what should be done next. |
| Recommending an action not supported by the facts. | Link the recommendation to the controlling evidence. |
| Making recommendations too vague. | Use action verbs: adjust, defer, disclose, obtain, test, approve, monitor, negotiate, or reject. |
| Ignoring feasibility. | Add the condition, owner, or follow-up that makes the action workable. |
| Overbuilding implementation. | State the critical follow-up without writing a full project plan. |