Summary
Summary of OBS Units
- Course
- OBS 114
- Institution
- University Of Pretoria (UP)
Include learning outcomes, diagrams, good examples. Neat layout. All learning outcomes covered.
[Show more]
Seller
Follow
Content preview
Unit 10 – Financial ManagementLearning outcomes
1. Explain the role and responsibilities of financial managers.
2. Outline the financial planning process and explain the three key budgets in the financial plan.
3. Explain why firms need operating funds.
4. Identify and describe different sources of short-term financing.
5. Identify and describe different sources of long- term financing.
The Role of Finance and Financial Managers:
o Finance - The function in a business that acquires funds for the firm and manages them within the
firm.
• preparing budgets
• doing cash flow analysis
• planning for the expenditure of funds on such assets (plant, equipment, machinery).
o Financial management - Managing a firm’s resources to meet its goals and objectives.
o Examine financial data prepared by accountants and recommend strategies for improving the
financial performance of the firm.
Auditing: internal inspection of a company,
it’s a detailed inquiry into the policies and
financial statements of the business.
External/ internal
Collecting funds: establishing the maximum
amount of credit you are willing to issue to a
company/consumer & how the collection of
those accounts will be handled.
Obtaining funds: raising money
Budgeting: exercising financial control as a
means of allocating funds towards expenses.
Financial planning: the future state of the
organization and assessing foreseeable
variables such as income and asset value.
o Three of the most common reasons a firm fails financially are:
1. Undercapitalization (SABC)
• insufficient funds to start the business
• cannot pay its creditors
• no cashflow
2. Poor control over cash flow. (Toys r Us )
3. Inadequate expense control. (eskom)
• practice of identifying means to reduce costs while increasing revenue for the company
• despite raising tariffs, Eskom is still losing money
, Unit 10 – Financial Management
Financial Planning:
Financial Plan
Short-Term Long term
Forecasting
Forecasting
Long-Term
Forecasting
Operating
(master)
Budget
Capital Cash
Budget Budget
Cash Budget
Financial
Controls
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller kavishtailor. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R50,00. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
75632 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now