Managing Finance

Running head: MANAGING FINANCE
Managing Finance
Name of the student:
Name of the university:
Author Note:

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Table of Contents
Introduction:..................................................................................................................2
Discussion:....................................................................................................................3
1. Understanding Finance within Organization..........................................................3
1.1 Relationship between the financial function and other functional areas............4
1.2 Impact of financial objectives on decision making within organization...............4
1.3 Management Accounting and Financial Accounting...........................................5
1.4 Impact of Organization and Regulatory Framework...........................................6
1.5 Challenges Organization Faces in Finance........................................................7
2. Set and Manage Budget........................................................................................8
2.1 Budget Setting and Financial Forecasting..........................................................8
2.2 Budget Setting Approach Used by Organization................................................9
2.3 Financial Budget...............................................................................................10
2.4 Factors that impact on Budget..........................................................................10
2.5 Corrective Measures taken in case of budgetary variance..............................12
2.6 Reporting Procedures for authorizing corrective actions of the budget...........13
Conclusion..................................................................................................................14

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Introduction:
The aim of the assignment deals with the unit of 520 in managing finance of
the business. Financial management skills are essential for the managers in the
upper level management apart from whether there is dedicated finance team within
an organization. Financial shrewdness further enhances decision making skills,
which provides support to the management related projects, tasks and functional
areas. Basically, the implication of the unit has been designed to enable learners to
understand how financial systems performs within an organization. Learners will
evaluate the sources of finance for organizations, and understand the principles for
setting and managing budgets in line with regulatory and organizational guidelines.
This unit has been designed to enhance the learner’s confidence and credibility in
financial management, which will translate into improved management skills1.
The leadership and the management decisions of the company must be
effective and the parameters which are needed to improve it are depicted in the
conducted study. The significant management responsibilities are discussed along
with the changes which are made accordingly. The regulatory framework of the
company have been discussed along with the necessary measures which must be
undertaken are also evaluated. The budgeted forecast of the IT organization has
been depicted along with the variances of the company has been made. The
changes which must be made by the upper level management of the company has
also been highlighted accordingly.
1 Freeman, Richard. Managing open systems. Routledge, 2014.

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Discussion:
PART A – FINANCE FUNCTIONS OPERATIONS
This unit mainly focuses on the skills of the financial management which are
significant for the managers apart from whether there is an enthusiastic finance team
within an organization. Financial shrewdness generally enhances the decision
making skills within an organization which further supports the management for the
projects, tasks and the functional areas performed within an organization. The main
implication of the particular unit is that it is actually designed in order to enable the
learners to understand the financial system which is operated within an organization.
The principles are needed to be understand in that scenario for setting and
managing the budget within the regulatory and the organizational guidelines. The
unit has been designed to further enhance the confidence of the learners and further
the credibility in the financial management will further improve the overall
management skills.
1. Understanding Finance within Organization
The key functions of the financial management are the financial planning where
the main motive of the management is to increase the flow of cash in the business.
The investment of the business must be effective in order to improve the overall
financial wellbeing of the organization in that case. The key tools which are used to
analyze the ICT Engineers are the Skills Matrix (Excel Spreadsheet) and Ivanti (Call
logging system). These tools helped the IT organization to analyze drive quality,

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measure performance productivity, preventing poor performance and further
identifying talent and potential.
1.1 Relationship between the financial function and other functional areas
It is needed to understand the financial situation of the organization by further
analyzing the financial functions and the other key functional areas of the IT
organization. In order to understand the skill measurement of the ICT engineers
there are some application of tools and techniques. Further this tools helps to
understand the existing skills, identifying the shortage in the skills and other
mismatches and then train people in order to improve their performance. It is needed
to manipulate the cost as per the current financial performance of the organization.
The financial functions in the organizations are basically within the macro level and
the project office teams treat in the same micro level.
The role of the finance department of the organization is that to manage the
business functions associated in the financial department. The main business
functions are the planning, organizing, staffing, directing and controlling the financial
situation of the company. The role of the financial function is to evaluate the financial
information’s. The financial departments used to calculate the Net present Value,
Future Value, Present Value of the company and many more. The above discussed
functions are the tools which are used to analyze the current financial position of the
company. The decision undertaken by the financial management plays significant
role regarding the acceptance or rejection of the projects in that case. The goals of

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the financial management are to make decisions in order to accomplish the financial
goals of the organization.
1.2 Impact of financial objectives on decision making within organization
The objective of decision making in corporate finance is to maximize the value
or the stock price of the firm. The financial objectives of the company are based on
the size of the company and business of the company. The significance of financial
decisions in the business is based on various factors in order to provide the growth
in the overall business of the organization. The main reason behind the business
failures is that the lack of financial planning, lack of capital, limited access to funding,
unplanned growth, low strategic and financial projections, excessive fixed asset
investment and capital mismanagement. The above mentioned failures are the
challenges for an organization which must taken care by the upper level
management of the company. The management in this particular situation needs to
take stringent financial strategies which must be implemented by the organization in
this kind of circumstances.
In an organization there are various kind of strategies which are involved in
the decision making of an organization which are the investment decision making,
funding decision making and working capital management of the company.
Analyzing the financial position of the company for the last five years or more will
automatically provide a clear picture to the management of the company for taking
decision in that case. The performance of investment, funding and the working
capital management of the company must be analyzed for the last 5 years or more
will further help the managers of the company in order to take decisions in that case.