FINANCIAL DECISION MAKING

Financial Decision Making

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
TASK 1............................................................................................................................................3
Accounting and Finance Department:.........................................................................................3
Importance of Accounting and Finance Department:..................................................................4
Role of Accounts Department.....................................................................................................4
Role of Finance Department:.......................................................................................................5
TASK 2............................................................................................................................................7
a. Calculation of of ratios for the company.................................................................................7
b. Comments on actual performance of company SKANSA and position for two years:..........9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Financial decision-making within business context may be explained as the processes/set of
activities attributable to devising financial decisions for an entity by considering annual reports,
interim financial reports and business's other financial reports. It is extremely important for all
business to ensure that their accounting-personnel are concentrating on productive business
decisions because it will enable the fulfilment of all longer-term and shorter-term organizational
goals. The principal aim of this project is to strengthen the comprehension of the essential
aspects that all enterprises need to consider for formulate efficient financial decisions (Black,
2019). The current study is centred on the SKANSA PLC i.e. construction corporation
incorporated in 1984. Company is UK based and operating its business in multiple nations. This
report discusses multiple points regarding value of the accounting and finance tasks,
responsibilities and obligations within corporation.
MAIN BODY
TASK 1
Accounting and Finance Department:
Accounting Department: An accounting department is particular division/unit
within firm/business enterprise that is accountable for tracking and monitoring cash ins or
out flows of organisation. The accounting division is accountable for a vast variety
of accounting as well as tasks within the enterprise. This department not only responsible for
recording and reporting of financial reports but also formulate processes and policies for
controlling flow of funds within entity as well as safeguards financial resources. It is component
of administration of organization liable for filing the annual statements, managing the corporate
accounts, collecting bills, billing buyers, payrolls, expense monitoring, financial reporting, and
much more. The top of accounting department also carries the designation of controller (Kim,
Gutter and Spangler, 2017).
Finance Department: A finance Department/unit in an entity is characterised as component
of an entity which is accountable for obtaining funding for the enterprise, administering funds
inside the organisation and scheduling the spending of funding on different asset classes. It is
component of an entity which facilitates the effective financial reporting and fiscal surveillance
requisite to finance all operational processes. The input of finance department/unit of every

enterprise including how these inputs have a significant influence on corporate results would rely
heavily on considerations like the level to which owner/manager is engaged with the corporation.
Importance of Accounting and Finance Department:
Accounting Department: The everyday bookkeeping and preparing of financial records is
the responsibility of accounting staff. To take higher decisions regarding financial strategy,
one first need to determine where the business is based. Everyday record keeping involves
billing and salaries, and production of financial reporting involves synthesising and finalising
these details in budget statements, annual fiscal statements and cash-flows accounts at routine
periods, normally annually. Accounting department/unit is liable for tracking and
reporting company's cash flow activities. This unit has a range of core functions and duties,
including trade receivables, current liabilities, accounting, financial statements and the
management of financial standards (Elbayoumi, Awadallah and Basuony, 2019).
Finance Department: This is amongst the most critical of all company operations. Finance
department performs a pivotal function in the organisation. Correspondingly, finance department
of the company must provide all other divisions (operations) with the requisite funds to carrying
out their operations. The finance division is accountable for maintaining this routine so that the
business does not really run-out of funds to cover its bills, nor does it cost too high for finance
costs. Financial departments can also use existing records and analyses to forecast the
corporation's progress and future developments. Finance Team designs growth projections and
plans, handles and minimises costs, aims for opportunities to raise resources, oversees budgets
and funding options, and links with stakeholders. A sensible finance team has complete image of
the corporation 's activities and understands how each feature and task impacts the corporation 's
overall financial situation.
Role of Accounts Department
o Financial accounting: Financial accounting is primary feature/role of accounting
department which includes the task of monitoring, summing up and publishing a range of
transactions arising from company activities over a length of term. Such transactions are outlined
in the preparing of financial reports/accounts, along with balance sheet, profit/loss statement
and cash-flows statement, which document the organization's business 's financial results
for given duration. Financial accounting functions should provide financial reports in a way that
enables the interpretation of corporate results (Klačmer Čalopa, 2017). Company owner, can