Financial Decision Making: Role of Accounting and Finance in Organisation and Ratio Analysis of Alpha Ltd

Financial Decision Making

Table of Contents
INTRODUCTION...........................................................................................................................4
MAIN BODY..................................................................................................................................4
TASK 1............................................................................................................................................4
Role of accounting and finance within the organisation..............................................................4
TASK 2............................................................................................................................................7
Ratios...........................................................................................................................................7
Position of Alpha ltd..................................................................................................................12
Conclusion.....................................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
Financial decision making is the very important business activity. It identify strengths and
weakness of the decision because it is attached with money. It is the decision which is taken by
managers related to company finances. These decisions are considered as one of complex
decisions. Alpha ltd is the UK based company. This is the manufacturing company and wanted to
extent their operations. This report will discuss about the role finance and accounts in the
organisation. Further will evaluate company's performance by calculating ratios using company's
financial statements and also stating causes and effects for change.
MAIN BODY
TASK 1
Role of accounting and finance within the organisation
Concept of accounting:
Accounting is the procedure to record financial transactions of the business (Zyznarska-
Dworczak, 2018). Steps of accounting involves reporting, evaluating and interpreting the
transactions in order to regulate and to get tax collection entities. Through accounting financial
statements are prepared which can be called as a summary of financial transactions. Financial
statements are helpful to know company's financial position and cash flows. Accounting is the
function which takes place in every business regardless of their size. In small company accounts
are handled by accountant and in large companies it is handled by accounting and finance
department of the company. Accounting have many field like cost accounting, managerial
accounting etc. these accounting streams helps management of the company in decision-making
process.
Concept of finance:
Finance means managing money of the company and it covers activities like saving,
investing, budgeting, lending, forecasting etc. finance are of three type that is public finance,
personal finance, corporate finance. The concept of finance can be defined as study of money
and various financial instruments. Finance is related with funds which can be taking or using the
funds. So business have to make sure that necessary funds should be always available from right
sources at right time. It depends on business that from which source they raise funds like banks
loans or issuing securities. After business has taken funds from the market then it is very
important to allocate funds in different projects in order to gain returns (Jayasinghe and Uddin,