Financial Management Assignment (pdf)

Added on - Dec 2020

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FINANCE FOR
MANAGER
TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 The purpose and requirement of financial records................................................................1
1.2 Techniques for recording financial information....................................................................2
1.3 The legal and organisational requirements of financial records............................................3
1.4 The importance and usefulness of financial statements to stakeholders................................3
3.3 Differences in management and financial accounting...........................................................4
3.2. The process of budgetary control.........................................................................................5
3.4 Different costing methods used for pricing policies.............................................................6
TASK 2............................................................................................................................................7
3.3 Determining the variances on cost and revenue....................................................................7
4.1 Demonstrate the main methods of project appraisal..............................................................8
4.2 Calculation of the projects.....................................................................................................9
4.3 Different sources of funding................................................................................................12
2.1 The components of working capital and how it is useful in working capital management.13
2.2 The components of working capital management...............................................................13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15
INTRODUCTION
Financial accounting is a key element for financial management of any organization.
Financial control is very important to for all the financial activities in an organization. The
present report focuses on various aspects in Malta Ltd company which is important for a
financial manager. The report depicts purpose of keeping financial records and why it is
important. Different techniques of financial reporting are mentioned in report. The rules and
regulations required for financial recording is presented. Different costing methods of pricing is
described in the report. Calculation on variance is present in report which shows actual and
budgeted profit figures. The report presents the calculation on different techniques of project
appraisal for Board of Director to choose a suitable project for investment., by describing
methods of project appraisal.
TASK 1
1.1 The purpose and requirement of financial records
It is a document which records all financial transactions of an organization, individual or
business entity (Yin, Arbaiy and Din. 2017). Books of account records all the necessary
transactions which helps in financial statements such as balance sheet, trail balance, general
ledger etc.
The purpose of financial records is:
Maintaining proper records of expenses, income would help in filing the taxes, and will
avoid any problem regarding financial accounting.
It helps in establishing accurate and complete accounting and recording system.Forpreparingaccuratefinancialstatementswhichhelpsinascertainingfinancial
performance at end of year.
The importance of keeping financial records are:
Financial records help in monitoring the performance of a business. It improves in
decision-making for business,
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Keeping good financial records are the key element in preparing financial statements for
company, like income statements, balance sheet of company (WHAT IS FINANCIAL
RECORD,2018).
Financial records assist in identifying the sources of different transactions. It is important
to keep different accounts for sources like income and expenditure.
Recording of financial transactions will help to prepare the tax return files.
1.2 Techniques for recording financial information
Data of all financial activities in business are called financial information. It would help
in financial records and preparing financial statements of company.
Techniques for recording financial information are:
Reconciliation: It is a process of comparing financial information that is being recorded
in two systems or accounts (Schinckus ,2018). It is important to analyse and compare both the
entries of transactions and make correction if required to make information accurate to use.
Verification: It is a process of examining information contained in report or system to
ensure that the information is accurate and complete. Every information should be verified
before recording in financial books.
Journals:It refers to record the accounting transaction of the organization with the
particular date. It helps the company to record all the transaction systematically and with
accuracy for the further use by Ledger.
Ledger:It helps to record the economic transaction in term of money with debit and credit
side. It is used to record the book keeping entries for the further calculation of balance sheet and
profit and loss account.
Double entry system:It refers that for every transaction amount will be recorded in two
accounts to maintain the accuracy of the data. It helps to match the debit side of the transactions
to its credit side. Companies normally use the double entry system to minimize the errors and
fraudulent activities.
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