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HND Managing Financial Resources Decisions
When the activities are run in a business effectively, the financial source is very important. Our Managing Financial Resources and Decisions Assignment Sample is excellent. This is a vital tool for an organisation. For following the sources effectively, the sources can be segregated using external and internal financial sources.
What are Internal Sources?
In the organization, we find such sources. It influences the total organizational effectiveness. There are some internal sources present and they are as follows:
Profits- Every organisation has retained profits and it is created through business operations. This is judged in the form of a successful internal source for the finance and it has a low cost. It is regarded in the long term of an organisation.
Revenue- A revenue can be explained as business sales carried out through the operations which is the product sales in a company meant for manufacturing. The services are meant for the company.
Sale of assets- The finance is obtained by the organization using the property sale and asset sale by the company. This is an effective source and this helps in liquidating blocked company assets.
Loan from Directors- The most important people are the members and directors. This is true for any type of business. The loan is taken by the organization and it has a particular rate of interest. The organisation must be able to pay that amount.
Retained dividends- The finance is acquired by an organization as the dividends are stopped. The dividend is the money of company shareholders. They use them within the organization.
What are the External sources-
The organizations use the following external sources which might cause a total organizational effectiveness.
Debentures and Shares Issue – A successful financial source is the issuing share capital in the environment of business. For the environment of the right now, the share capital issue has been regarded as a successful way of obtaining finance and it is meant for the future. On the basis of shares issued, we find voting power transfer. The company ownership also show transference. When the debentures are issues, the number of creditors goes up within a company. They get the rate of interest which has been predefined interest rate. If you need Managing Financial Resources and Decisions Assignment Sample, we are ready to help you.
Loan from bank- The banks are used for arranging loan for the organisations. It can be of two types short term which is based on the specific rate of interest. It is regarded as the right source in finance. The choice is made by the Entrepreneurs.
Bank overdraft- This has been regarded in the form of facility offering given by the banks for the customers over the current accounts. The foundation is the goodwill where they can take away a certain some of money greater than the bank balance present in their account. We find charged interest for that particular amount and they will be paid again for a particular period of time. This has gained success for the short span of time.
Venture capital- This is a financial source where there are different equities where the financial investment takes place. The ideas are quite effective and the purpose is investment and the right profits.
We have come across different aspects which motivates the choice of financial source. The selection is carried out by a company and they follow the organizational need. We take the decision on the basis of analysis through various aspects and it motivates those decisions.
Bank Loan – The finance is important for the entrepreneur and this will be organized in an easy way. The bank is the source of loan. It offers significant security and there is an agreement on the conditions and terms of the banks.
Loan acquired from the directors- For any type of organization, the vital people can borrow the money for the project for running successfully. The objectives must be achieved effectively. For a project of a start-up, this is regarded quite successful. The purpose is acquire financial assistance from a particular source. We are ready to provide you the Managing Financial Resources and Decisions Assignment Sample.
Bank overdraft- The finance might be acquired through using bank overdraft facility. The bank helps in the extraction or collection of the funds. It is greater than balance for a particular customer account. The term is quite short and it is the origin of finance in any type of business. This has been regarded to be effective.
Most of the organizations has a successful financial planning role which causes an influence for the different activities. The success of these companies helps the organization become successful. The different factors are identified through a process known as Marketing Planning. The analysis is made and a right decision is taken. The different processes are comparing, forecasting, right administration and the analysis of the factors. We come across certain points revealing the priority of the financial planning within an organization.
● Different factors are pointed out in association with the need of the organizational finance. It assists in the analysis of the presence of the organizational funds.
● We can assist in more financial requirement within the organisation for successfully carrying out most of the activities and getting fruitful results.
● The planning of finance helps in decreasing a ratio of uncertainty inside an organisation along with the activities.
● Creating budget offers the right control for the utilization of organizational finance. The utilisation becomes effective in an organisation.
We find some participation in the organisation and the different parties are regarded and they were checked for the decision making. We need certain data for accessing them.
Who are these shareholders in the organisation?
● An organization has vital members and they are identified as shareholders. They are taken at the time of decision making and these members have the right to vote. The information is given to them. It is associated with the position of finance in a company. Some examples are liquidity, revenue, earning per share and profits. It assists them in decision making.
● The information is obtained from the Board of Directors It is associated with the presence of finance. It helps them in taking the decisions associated with creating successful policies along with organizational regulations. We have a team of writers for Managing Financial Resources and Decisions Assignment Sample.
● The company has investors offer information associated with flexibility, profitability, future plans and debt equity ratio. It assists in decision making for investment.
● The role of the government is quite effective. The taxes should be paid. The application of different grant needs to be made. For this reason, the right information is essential. This information should be related to the organisation. Whenever you need Unit 2 Managing Financial Resources Decisions Assignment, we will help you.
The analysis is carried out for the decision associated with the finance sources. We have come across two vital forms of financial sources. It is meant for the business and they are:
1. Internal Finance Sources: It consists of the investment in the retained earnings along with the capital plus the company profits.
2. External Finance Sources: It consists of searching for the investors and bank loans. There is also search for credit.
These fundamental types are quite common. These types are quite useful in the business field. As per different businessmen, the people find it important to utilize the personal money and it includes the internal finance sources for financing a company. It indicates the company is going to guarantee those sources have been financed appropriately. But the external finance sources of finance are not appropriate for a company because of the costs. We are ready to solve the difficult Unit 2 Managing Financial Resources Decisions Assignment.
What are the advantages of financial management?
An efficient financial management will assist the organisation in the following ways:
● Prepare the successful and proper utilization of the resources
● Fulfill the objectives of the stakeholders and reach the target
● Increase accountability for the donors along with the different stakeholders
● Improve the respect along with confidence in the agencies of partners, financial assistance.
● Increase the advantage in the competitive environment by the rare resources.
● Maintaining the sustainability in the finance in the long run.
Basic principles in the process of financial management
● Regularity: The policies of finance and the systems should be consistent along with time.
● Right of answering: You need to give an explanation and demonstration to most of the stakeholders on the way they utilized the resources and their achievement.
● Clarity: There is an openness in the organization and it is related to work along with the finances. The information is present among the stakeholders.
● Honesty: The organisation has individuals who operate showing propriety and honesty.
● Stewardship in finance: Proper care is taken by the organization for providing the financial resources. They need to be utilized for the right intention.
● Standards of accounting: The organizational process in maintaining the records of finance. Using the documentation, the right standards of external accounting are maintained.
1. Establishing reports of financial or bookkeeping
The initial aspect is to fix the system which permits the information on bookkeeping along with the detailed information in finance. The software can be used easily. The programs are quite affordable. An example is QuickBooks. One can enter and group the information of finance. The reports must be prepared accurately. We can provide you sample on Managing Financial Resources & Decision Making.
The client will be able to reach useful reports on finance. They are revenue, profit and loss, expenses, cash flow projections and the balance sheets. We come to know the true nature of business. You might establish and deal with the process independently. You might also recruit a bookkeeper on full-time or part-time basis. They can obtain report on the basis of year, quarter and monthly basis. The client will get the knowledge for the future plan of the business.
2. Keep yourself updated for cash flow
We can examine the cash flow daily. The simplest way for carrying it out can be stated as follows:
● You need examine the balance of your bank account.
● You can take a print of the report of cash-flow. It indicates the future revenue which is pending in a particular period of time. There are payments or expenses pending at the similar period of time.
● We can ensure the balance of bank account along with the revenue and they are greater than the payments or expenses. You might modify the timing of payment if there is a possibility. You might utilize the line of credit. You can get the best sample on Managing Financial Resources & Decision Making.
3. Checking the expenses and income
The major aspect of the financial management is summation of the financial records a company is earning and money being spent at the bookkeeping process. The reports will be created which allows an individual to examine and follow the degree of gross income deducted from goods price and different expenses. The true net income is exhibited and it assists an individual from observing the income for the wrong level.
4. Planning for saving the tax.
The most important aspect is to discuss with the tax accountant. You will find the sum total of the taxes of the company. You can organize for the various methods of decreasing taxes. For instance, prior to ending the tax year, the customer can decrease the cost of tax through preparing extra items expenses or buying equipment to fulfill the requirement of the business. The bills need to be paid before the schedule time. The deposition of the income checks are delayed for the bank account before the beginning of next year. With the reduction of taxable income, the money needs to be saved for paying tax.
5. Finding the percentage of profit
A vital step in finance is to understand the right percentage of profit. The individual can utilize the software for bookkeeping for developing reports which demonstrates the subtraction of the total costs or expenses from the gross income. The purpose is to check the gross income percentage and this is the actual profit. In order to understand the percentage of real profit which will assist us in planning in the right way for future. The efficiency should be high for improving the level of profit. We need to observe whether the company has been capable of fulfilling the target. Our team of writers are present for providing you the sample on Managing Financial Resources & Decision Making.
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