logo

Process of Managing Financial Resources | Report

11 Pages3367 Words133 Views
   

Added on  2020-01-07

Process of Managing Financial Resources | Report

   Added on 2020-01-07

ShareRelated Documents
MANAGING FINANCE INPUBLIC SECTOR
Process of Managing Financial Resources | Report_1
Table of ContentsINTRODUCTION...........................................................................................................................1LO 1.................................................................................................................................................11.1 Financial regulatory requirements in the public sector....................................................11.2 Evaluation of accountability in public sector while managing finance............................21.3 Publicly available reviews on financial information........................................................21.4 Role of Audit in Public Sector..........................................................................................3LO 2.................................................................................................................................................42.1, 2.2 and 2.3.......................................................................................................................42.4 Systems required to manage finance in a public sector organisation...............................42.5 usefulness of ratio analysis and capital investment appraisal for public sector decisionmaking and control.................................................................................................................5LO 3.................................................................................................................................................53.1 Stages of the public sector tender process........................................................................53.2 Exploration of how public sector tenders are evaluated, negotiated and awarded...........6CONCLUSION................................................................................................................................7REFERENCES................................................................................................................................8
Process of Managing Financial Resources | Report_2
INTRODUCTIONFinancial regulation is a set of standards subjects to some restrictions, requirements andguidelines targeted to keep integrity in Financial System. Central government or a governmentorganisation is responsible for maintaining these regulations. This system influences bankingsector by reducing the borrowing costs and increasing products of finances. Government createsregulations to maintain finances of public sector. In this report management of finance for publicsector is explained through regulatory requirements, public reviews, tender process, itsnegotiation etc. Further, report explains process of managing financial resources through apresentation and systems needed to manage finance in given sector are also included here.Moreover, ratio analysis is conducted for decision-making process with capital investmentappraisal.LO 11.1 Financial regulatory requirements in the public sector.Public sector is an important part of economy of United-Kingdom, financed by localtaxation. It is responsible for employing more than 6 million employees in UK and providingthem with services like pension benefits and other perks. FRC is responsible for governing therequirements in public sector (Palley, 2013). Financial reporting council was developed byAccounting Standard board (ASB) and then replaced by Accounting council, whose reportingauthority is Codes and Standards committee.FRC has divided the framework in three parts for regulation of financial reporting.Separate standards for different type of entity, reduces framework and follow SORP. However,transition arrangements are also included in the framework.International financial reporting framework has been a part of reporting framework in UKsince year 2005. IASB published IFRS for public sector which produces financial accounts forcentral government, public bodies or health sector. IFRS has formulated set of standards forpublic sector called International Public-Sector Accounting Standards. They are targeted toimprove quality of financial reporting by public sector enterprises.Another standard set by FRC for managing finances are known as GAAP's i.e. GenerallyAccepted Accounting Principles that are to be followed by all companies in United-Kingdom.They are set of common principles that are to be followed for compilation of their financialstatements. IT ensures minimum level of consistency in company's statements.1
Process of Managing Financial Resources | Report_3
1.2 Evaluation of accountability in public sector while managing finance.Public sector delivers their services to public using funds raised from them in form oftaxes or fees or penalties. They need to be transparent while managing their accounts, thus, aframework needs to be established to maintain effective accounting statements with managerialcontrol and proper management system.Responsibility regarding management of financial statements rests with Board,accounting officers, elected members, chief financial officers or executives. Each body isresponsible according to part of public sector they are serving (Barlow and et.al., 2013.). Thisframework is tightly regulated in aspects of accounting, covering procurement, audit process andaccounting. Independent scrutiny is done for audit by external audit committee, parliament orpublic investigation commission. Financial management when strong establishes confidence in public services andmaintains healthy relations with fund providers and taxpayers. Organisations need to ensure thattheir financial statements prepared are sound and they look like the way they are intended to benot just only in preparation process. Few characteristics that delivers accountability are:1.Creating a good role for CEO ensuring direct reporting from audit committee and chiefexecutive.2.Preparation of effective statements that reflects true and fair information regarding theincome and expenditures of the company.3.Seniormust possess financial management skills that are required for finance function.4.Evaluation and identification of management risks.5.Preparation of budget before the beginning of accounting year relating to the year whichis going to start in accordance to financial plan.1.3 Publicly available reviews on financial informationA market review was launched in august 2015 for financial advice on improper working.It was named Financial Advice Market Review (FAMR), it was aimed at various ways beingexplored in which government or industry regulators could take collective or individual steps formarket development(Hood and Dixon, 2013). Under which they would take steps forstimulation of developing market delivering accessible and affordable advice.Review backdrops a responsibility, for increased requirements fromindividuals takingcharge of own financial structure. Few happenings like change in demography or social structure2
Process of Managing Financial Resources | Report_4

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Roles of Regulatory Agencies in Australian Financial Reporting
|10
|2978
|112

Foundations of Accounting
|9
|1389
|378

Role of Financial Reporting Council, Australian Accounting Standards Board, IFRS Interpretations Committee, ASIC, and ASX
|6
|1212
|306

Financial Reporting and Analysis: Framework, Purpose, Interpretation, and Ratio Calculation
|16
|4992
|460

Current Issues In Company Reporting
|14
|3708
|32

Contemporary Accounting Assignment PDF
|16
|3851
|31