BSBFIN601 Manage organisational finances Question 1.1 / 1.2 / 1.3 / 1.4 Planning for financial management Write a paper of 2,000 words explaining why all business organisations must have effective financial management systems and explaining how the information held in financial management systems contributes to ongoing business performance and business planning. Key points that must be covered: Why is it important to have an effective electronic financial management system? Financial management is concerned with developing, controlling, tracking, and planning economic resources in order to achieve organizational objectives. You can only have great economic control if you have a legal business strategy. A plan based on this context method that has defined goals and has settled, progressed, and assessed the guidelines, strategies, tactics, and motions to achieve those goals. Financial management frameworks are vital for any firm, large or small, since they represent more than just keeping accurate records and balancing your business inspection account. You must modify your budget so that you do not overspend and that you remain prepared for all costs as well as earnings distributions. Your monetary control responsibilities touch all aspects of your firm. A company that sells well but has poor financial control may fail. The economic management of an organization plays an important role in the economic success of a developing corporation. As a result, an agency should keep in mind that monetary management is an important aspect of total agency control. Financial control comprises of the planned and strategic desires related with the business's monetary resources. Accountancy and clerking, debts payable and receivable, funding prospects, and risk are some of the primary specific functions addressed in economic control systems. List and describe 5 examples of the type of financial data that will be collected and inputted into the electronic financial management system. When establishing any economic control machine, a business must select whether the machine will be controlled internally or outside. Any accounting device must measure, categorize, record, and communicate all monetary data about the organization. The foundation of an effective accounting tool is proper bookkeeping. A bookkeeper receives complete and accurate financial information from a certified public accountant. While the accounting machine examines the overall financial picture of the organization, bookkeeping provides specific transactions that occur on a daily basis. The terms clerking and
accounting are practically interchangeable in monetary jargon. Nonetheless, the criteria are not the same. While clerking is all about roughly documenting monetary transactions, accounting provides clarification, examination, arrangement, reporting, and summation of a business's monetary records. Account payables provide a corporation with information about bills with vendors. This is made up of first-rate payments owed to the vendors. Furthermore, account payables will show the price of things purchased, but the company made bills in the past, as well as information about the firm. Accounts payable is a cutting-edge legal liability account that keeps track of the money you owe to any third party. Third-party occurrences might include banks, businesses, or a person to whom you have borrowed money. Purchasing purchased foritems or services from several companies is a commonplace example of money owing payment. Depending on the terms of reimbursement, the amounts are frequently payable immediately or within a short period of time. What organisational documents will you access to find this data? Accounts receivable is a modern asset account that keeps track of the cash that third parties owe you. Again, those 1/3 occurrences may be banks, businesses, or people that borrowed money from you. One commonplace example is the amount owed to you for goods or services provided by your employer in order to generate money. The ideal technique to record account payables is through business transactions; firms will frequently purchase items on credit (now no longerfor coins). The term used to describe the transactions is "on account," which denotes a transaction in which no coins are involved. In contrast to recording accounts receivable, there are times when an organization will market things or services "on the account." Again, it is the manner by which a transaction is carried out in which coins are always involved. Another important point to note is that organizations may occasionally link reductions to their account receivable money owing in order to entice the borrower to refund the amount quicker. The savings benefit each event since the borrower receives their discount while the organization receives their coins refund sooner, as agencies demand coins for their running operations. How can you ensure the safety and accuracy of the information in the financial management system software? Make a detailed business strategy. Keep an eye on your financial situation. Ensure that your consumers pay you on time. Understand your daily expenses. Maintain accurate accounting records. Satisfy all tax deadlines. Get more efficient and keep overheads under control.
Stock in control. What is the financial year period in Australia? The Australian income year for tax purposes consists of the 12-month period from 1 July to 30 June. Why is it important to analyse data from previous financial year periods when forecasting and developing new budgets? Financial forecasting is performed by small firms by studying past data and predicting the company's future financial performance. Financial statement forecasting assists small businesses in planning future growth and managing cash flow. Why is it important to analyse the profits and losses of the business? A profit and loss statement, also known as an income statement, revenue statement, P&L statement, or simply P&L, can assist you in determining the overall financial standing of your company. It is one of three major financial statements used by organizations, the others being the balance sheet and cash-flow statement. When applying for a loan or other sorts of finance, you'll need to offer this paper as one of the key documents. A profit and loss statement (P&L) shows banks and investors your company's overall income, debt burden, and financial soundness. How is financial data reported in the business plan and strategic plan? Many firms experience monthly or seasonal income fluctuations, which translate into times when cash is plentiful and others when cash is scarce. The owner considers these cycles while developing the financial strategy in order to keep spending under control during the projected low revenue periods. Improper cash management can have serious repercussions, such as being unable to meet payroll. Having a defined financial strategy that includes a cash cushion allows the business owner to sleep easier at night. The cash cushion enables the company to capitalize on opportunities, such as the opportunity to acquire inventory from a supplier at temporarily decreased costs. How do finances relate to resource management In order to achieve the business goals, every organization will have a framework or procedure in place for planning, organizing, directing, regulating, and monitoring its financial resources and operations. Financial resource management (FRM) or financial management is the term for this. Financial management is a critical component for every organization's activities since it acquires finances, allocates resources, and tracks financial performance. Additionally, finance provides a tool for investors and other interested parties to evaluate management operations.
Uploaded by ProfThunder11923 on