BUSINESS FINANCE

POINTERS TO REVIEW

 Planning is related to this management function

 It is about setting the goals of the organization and identifying ways to achieve them
 This goals can be achieved for a year.
 This goals of a company can achieved between one to three years
 This goals can be achieved five to ten years.
 The goals of a company can be divided into three terms
 It describes what top managers want their company to become
 It describes how the company will achieve its vision and makes the purpose and objectives of the
company clear.
 It refers to the current assets used in the operations of the business
 Examples of this are the cash, accounts receivable, inventories, and prepaid expenses

 Six steps in Planning. (Chronological order)

Set goals or objectives.
.Identify resources
Identify goal-related tasks
.Establish responsibility centers for accountability and timeline
Establish an evaluation system for monitoring and controlling
Determine contingency plans
 Working Capital Financing Policies
Maturity-matching working capital financing policy
Aggressive working capital financing policy
Conservative working capital financing policy
 5c’s of Credit Evaluation
Character
Capacity
Capital
.Collateral
Condition
 Internal Controls to Safeguard Inventories
Separating custodial functions from the recording functions
Aging of Inventories
ABC Analysis
 Two Basic Finances Problem
Investment Decision
Financing Decision

 Interest Formula
I=PxRxT