logo

Report on Managing Financial Resources and Decisions

   

Added on  2020-01-28

20 Pages5803 Words38 Views
Managing FinancialResources andDecisions1

Table of ContentsINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................31.1 Financial sources available to different businesses...............................................................31.2 Implications for utilizing internal and external sources of finance........................................51.3 Most suitable sources of finance for Clarion-antiques-limited..............................................6Task 2...............................................................................................................................................62.1 Cost of financial sources........................................................................................................62.2 Significance of financial planning for Clarion-antiques-limited regarding fund allocation..72.3 Information that is required for decision making on financing.............................................72.4 Impact on financial statements of Clarion-antiques-limited..................................................8TASK 3............................................................................................................................................93.1 Cash budget for Clariton Antiques Limited, its analysis and suggestions in order toovercome shortfalls......................................................................................................................93.2 Ways for assessing cost of each unit and prices as well......................................................103.3 Different methods of capital budgeting for taking investment decisions............................12task 4..............................................................................................................................................144.1 Key elements of financial statements..................................................................................144.2 Format used by Clarion-antiques-limited to present financial statements with sole trader orpartnership or both.....................................................................................................................154.3 Interpretation of current financial statement of Clarion-antiques-limited through ratioanalysis.......................................................................................................................................16CONCLUSION..............................................................................................................................18REFERENCES..............................................................................................................................192

INTRODUCTIONFinancial management organization is important for the entire business organization'sdevelopment. It includes different sources and monetary tools for proper fund allocation. Thepresent report is based on understanding financial resource management and making decisionsfor Clariton Antiques Ltd. It is one of the largest antique items provider enterprises of Londonwhich is looking for its expansion by operating new branches. In this regard, various internal andexternal financial sources for allocating fund are also determined. However, financial planningand decision making for the systematic financial management is to be recognized. In addition tothis, cash budget is prepared and pricing decision is made by performing relevant calculation.Along with this, elements of financial statements are discussed and comparison of businessperformance is carried out by using ratio analysis method.TASK 11.1 Financial sources available to different businessesUnincorporated business: - These organizations are not registered in company house. Inaccordance to this, decisions regarding business operations are taken by the company's ownerand manager. Under these entities, partnership, sole trader and private limited companiesprepare strategies set by an individual. For instance; Clariton Antiues Ltd is one of the greatexamples of unincorporated business which is handled and operated by its four partners.However, unincorporated organizations are under monitor of private individual which are notregistered in the company’s house of UK (Morley and et.al., 2016). In this regard, decisionsincluding financial and non-monetary are made by the company's owner to operate theorganization effectively. Thus, unincorporated business entities are operated by the privateindividuals to maintain good reputation and enhancing profitability of the firm.Incorporated business: - These are those organizations that are registered in company'shouse. Therefore, these companies have to follow rules and regulations provided by theCompany house of UK. Under these businesses, there are some criteria and after passing thesame any firm can be registered as company. Under incorporated business, various entities ofUKlike Tesco, Sainsbury etc. In addition to this, there are government intervention presents forsupplementing goods and producing qualitative services of the firm. However, incorporated3

Massingham, P., 2014.business entities set target in increasing profitability in business. Socialwelfare is another target of the firms which is fulfilled by performing the CSR activities. Thus, itcan be said that companies have multiple targets in their business (Massingham, 2014). Internal financial sourcesThese include reserve fund and earned profit for allocating fund regarding expansion ofClariton Antiques Ltd. However, various tools and components can understand as below:-Personal saving: - Partners of Clariton Ltd can use their personal savings for expandingthe entity. In this regard, saved money in bank and other financial institutions can be utilized onenlargement of organization by establishing new branches (Staddon, 2016). It is considered as aneffective source but it impacts financial position of individual.Retained Earnings: -It is determined as net income company earned. Therefore,reserved fund and gained profit can be used for allocating the fund regarding operating newbranches in Birmingham. Including this, it is also considered as risky for further businessoperations due to decreasing in the liquidity assets of organization. Sale of assets: - It is a source from where some times firm arrange finance to fund theiroperations. In this regard, old and wastage machinery equipment are sold out and in this wayfund is obtained from this source of finance (Hart and et.al., 2014). External sources for allocating fundThese are those sources that can be allocated from different financial institutions Icanexpress as:-Long term loan: - Taking loan from financial institutions such as bank and otherinstitutions that provide loan facilities. In this regard, high level of finance can be obtainedthrough this source that is usable for enlargement of Clariton Antiques Ltd by establishing newbranches (Monteiro, 2016). However, it impacts the financial position of organization. In thisaccordance to this, interest rates over loan services affect economic structure of the firm.Borrow money from other business entities: - According to set targets, for gaining fundcan be obtained through taking help from other organizations. It remains usable to allocate largescale fund for operating new branches.However, there is implication determined for presentingmonetary profile of Clarion-antiques-limited. Thus, company must focus on this tool for takingadvantage of loan from other businesses (Laot, 2016).4

End of preview

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

Related Documents
Report on Financial Sources & Investments - Clairton Antique Ltd
|19
|5570
|41

(Solved) Sources of Finance - PDF
|14
|4040
|59

Managing Finanacial Resources and Decisions- Clariton Antiques Limited
|21
|7363
|28

Managing Financial resources and decisions
|20
|7638
|195

Managing Financial Resources and Decisions INTRODUCTION 3 Task 13: Identifying the sources of finances for 31.2 Implication for using 41.3 Appropriate financial source for Clariton Antique Ltd 5 Task
|22
|5870
|196

Managing Financial Resources and Decisions INTRODUCTION 3 Task 13
|21
|6504
|129