Finance Information--Must Know's
The finance department is responsible for recording all the internal business accounting and bookkeeping transactions in the company’s accounting journals. This includes a myriad of activities such as sending invoices to customers and collecting payment, paying vendors and overhead expenses and distributing payroll.
While these are important and fundamental company functions, higher-level "CFO" responsibilities such as the management of the financial resources, profitability assessment, budgeting and forecasting are crucial to maintaining the financial health of the company. Unfortunately, for budgetary reasons most small organizations do not hire individuals with this level of financial acumen. It is this lack of financial management that ultimately leads to company failure. In other words, it could be said that the company failed due to a decrease in sales but actually, the failure is due to the company inability to recognize the pending decrease and make the required financial adjustments.
Larger organizations also experience sales declines but the CFO recognizes this through forecasting models. They may still experience a decline as they are forced to do a massive layoff or debt restructuring but they continue to stay in business allowing time to recover. Whereas the smaller company, lacking the financial sophistication, looses the advantage of time to make the required changes.
Such financial acumen can be available to small companies and may not be as expensive as perceived. There are various companies and independent consultants that function as contract CFO's and business forecasting models can be purchased. Additionally, some CPA's also function as business consultants and offer CFO type services.
To purchase EBooks on this and other business subjects visit www.BusinessSimplyPut.com
(See www.LWandAssociates.com and www.BusinessSimplyPut.com for more information).
Categories: Finance
Tags: small business advice finance Business simply Put Lori Williams CFO small companies
i found thiz blog much informative for me...
Reply to this