Financial Decision Making

Financial Decision Making

Executive Summary
Finance is like blood for the body of organisation while department of accounts and
finance is like bloodline which provides funds for procurement and utilisation of resources.
This report pertains to understand the functions, roles and responsibility of the accounts and
finance department of the organisation. This report has undertaken understanding accounts and
finance department for the SKANSKA PLC. In the report, two sections are there. First section
is the theoretical understanding of importance of accounting and finance functions, duties and
role and roles within company from the management point of view and second section is ratio
calculation and ratio analysis to comment on performance of company’s liquidity, profitability
and efficiency so that investors’ can make informed decisions about their investment plans.

Contents
Executive Summary.................................................................................................................................2
Introduction..............................................................................................................................................4
Task 1..................................................................................................................4
Accounting Department.......................................................................................................................4
Financial Department...........................................................................................................................5
Task 2.................................................................................................................7
Ratio Calculation.................................................................................................................................7
Ratio Analysis......................................................................................................................................7
Conclusion.............................................................................................................................................10
References..............................................................................................................................................12

Introduction
This report pertains to discuss financial management of Skanska Plc. It is a
construction company which as started in the year 1984. It has been performing well with the
stability and sustainability. However, struggles with difficulties like unavailability of high
cash as in demand in the industry. Its strength has allowed it to consider planning for
expansion so that it can explore opportunities present in the market. Although, it needs to stay
vigilant against the competitors from whom it faces tough competition (Masri, Pérez-Gladish
and Zopounidis, 2018).
Task 1
Accounting Department
Accounting department of a company is that division which is responsible for the
preparation of the financial statements, payment of bills, maintenance of general ledger,
preparation of customer bills, payrolls and many more tasks (Bangma and et. al., 2019). In
other words, accounts department of the SKANSKA PLC are responsible for the management
of the economic front of the company business. Below mentioned are some responsibilities
performed by accounts managers of the company in the light of the roles assigned to them:
 Financial accounting – Financial accounting of a business includes recording of all
the transactions and events of the company that is in financial nature (Taylor, 2017).
All those transactions which are of significant nature are recorded separately while of
not so significant amount are recorded in a clubbed manner. In other words, accounts
manager of the SKANSKA PLC is assigned responsibility to identify, record, group,
classify and present information of financial nature in various books of accounts.
These information are then clubbed together to prepare financial statements of the
company. Financial statements of the company include Income Statement also known
as profit and loss accounts, Statement of Financial Position also known as Balance
Sheet and Cash Flow Statement. These three statements are then later utilised by
management of the company as well as other stakeholders of the business to make
informed decisions about the stakes that they hold in the company.
 Management accounting – Other than information of the financial nature, there are
various other information which are not of financial nature yet they are very important
to be assessed as they make significant impacts over the decisions of the business
(Esch, Schulze and Wald, 2019). This information is assessed in the management