a) What are the consequences of telling the president of your gross miscalculation? In order to determine the sales and income projection, it is useful to forecast the budget based on prior performance of the company. The business performance of the current year will shows how the company is actually performed and this is a good indication to expect the company will perform better in future. As to obtain an accurate sales projection, we collected all the information from the company because each area of business operation might have a separate budget. For example, Fernetti Conductor has a specific budget for advertising, purchasing, sales production and cash budget.
Organizing and directing is thinking of ideas and putting into effect. The established plans will help run the company in a better financial future. The managers have to decide help to organize the information and direct employee to follow the right concept to better the company. Last elements is the decision making is the deciding which choice is right and see if there are any alternatives for the company financial
This is putting your action points from the Decide stage into action to achieve the goals laid out in the assess stage – whether it is shopping around for the best value financial products, or looking for ways to increase your income. The Review Stage is essential, and
It is very important to involve the SMEs in the cost planning also to get the accurate estimate for the cost. After the budget is planned it is critical to monitor and control the project’s cost. Earned value analysis helps monitoring the project cost. Monitoring the project cost against the actual cost provides the project manager how to handle the rest of the project. The sooner the issues have been caught the sooner it has been taken care.
A cash flow forecast is also prepared which gives an estimate of the amount of cash the company expects to flow in and out and also includes all the projected income and expenses. This will help in predicting any upcoming cash surpluses or shortages which can be used to help make the right decisions. It can help in planning new equipment purchases or identifying if the business needs to secure a small business loan. The cash flow forecast is also used to check if the company is meeting expectations. Comparing actual income and expenses with the forecasts can identify where the company is over or under performing.
To achieve this, the management needs to make viable and reliable business decisions regarding the operations of the entity on continuous basis (Taparia, 2004). The information contained in the four financial statements put the management in a better position of realizing this objective considering that it assists in the identification of the weaknesses and strengths of different organizations on top of showing important trends in their performance during different financial periods (Alvarez & Fridson, 2011). The comparative information provided in the financial statements assist the management to compare its past performances as well as its current one with those of its competitors in order to come up with efficient strategies to better a firm’s performance (Taparia, 2004). Calculation of different financial ratios from these statements specifically yields the information to be used by the management while undertaking all decision making exercises (Alvarez & Fridson,
Big advantages need to be broke down for their financial value and smaller advantages might seem to be more difficult to measure at first, but they will ultimately give the business more financial opportunity in the future. If the assets surpass their cost of accomplishment, the assets should be broke down using capital budgeting and figure out if they will see a good sizable profit compared to the capital that the company must invest in. A company needs to arrive with information systems plans that satisfy the business plan and approach, and correspond with their existing information technologies. Using scoring models and portfolios breakdown can both be used to help evaluate information systems
This strategy emphasizes the company’s ability to utilize its existing internal resources and focuses on streamlining operation through proper sizing and cost reduction. Even though this way could create short-term benefits to shareholder, this approach could negatively impact the company’s ability to adjust to external changes, especially rapid market and competitors’ changes. * Outside-in strategy: which is external market oriented strategy. Company makes the business decision according to the customer needs and market trends. It is “outside –in” thinking, which could help company to catch up with the market trend and develop products and services that meet the needs of customers.
WESTERN GOVERNORS UNIVERSITY Financial Analysis RJET Task 1 Executive Summary An extremely crucial element to any business entity is the financial analysis process. So what exactly is financial analysis? The actual definition is The assessment of the (1) effectiveness with which funds (investment and debt) are employed in a firm, (2) efficiency and profitability of its operations, and (3) value and safety of debtors' claims against the firm's assets. It employs techniques such as 'funds flow analysis' and financial ratios to understand the problems and opportunities inherent in an investment or financing decision. (WebFinance, Inc, 2013) Simplified it is the process of evaluating the current business, let’s say their effectiveness, and their future in their industry.
A portfolio analysis help a company with making decisions on what products that they must considered to be the main focused and which one they should get rid of. The portfolio analysis raises the issue of cash flow availability for use in expansion and growth for products in the organization. The BCG Matrix and the portfolio analysis would benefit a company to see where they stand with their products and where they should put more focus on to bring that particular product up in the market. Even though there are products that are doing well for the organization they can also become problems. The economy is going through some tough times now and it could be hard to keep the stars the stars and the cash cow the cash cows (Portfolio Analysis,