Analysis of Functional Units and Financial Management in Organizations

This report provides an overview of the functional units within a business organization, including human resources, marketing, and finance, each playing a crucial role in the organization's success. The human resources department manages the workforce, while marketing drives revenue through market analysis and promotion. The finance department handles financial resources, budgeting, and cost analysis. The report also delves into the significance of financial management, highlighting its roles in financial decision-making, capital management, risk management, regulatory compliance, raising capital, disposal of surplus, and financial planning. Financial management is essential for effective resource allocation, strategic planning, and ensuring the long-term growth and sustainability of a business. The conclusion emphasizes the interconnectedness of these functions and the vital role of financial management in driving business success.

Project

TABLE OF CONTENTS
INTRODUCTION......................................................................................................................3
MAIN BODY.............................................................................................................................3
Role of functional units in an organization............................................................................3
Role of financial management and reporting.........................................................................3
CONCLUSION..........................................................................................................................5
REFERENCES...........................................................................................................................6

INTRODUCTION
In a business organization there are number of functions which are required to be
performed. These functions have been divided among the various departments playing a
specific role in an organization. This report presents the role of various functional units of an
organization and also the role of financial management and reporting within a business
organization.
MAIN BODY
Role of functional units in an organization
There are different department in an organization having a specific role to play in.
Each of these functions are very crucial for successfully running the business. A detailed
description is given below.
Human resource: The HR department in an organization plays an important role in
managing the workforce in the organization. The main role of HR is to recruit new employees
as per the requirement, provide them training, comply with the employment role (Sims and
Bias, 2019). It is also responsible for motivating the employees and encouraging employee
engagement in an organization which helps in increasing the morale of the employees
resulting in creating a positive environment in an organization.
Marketing: The marketing department plays an important role in very organization as
it is the department which earns revenue for the organization (Mahajan, 2016). This function
carries out various roles such as carrying out market research, analysing the changing market
trends and scenarios, tastes and preferences of the customers etc. It also works on promoting
products and services of the organization, brand promotion, making advertisement campaigns
and so on.
Finance: This function of organization manages the financial resources. This
department provides assistance to the other department as it prepares budgets and then
analyses the budget of each department based on which resources are allocated (Ekpo,
Etukafia and Udofot, 2017). This works on cost analysing other plans of the business such as
investment, expansion to the know the feasibility and profitability attached to it.
Role of financial management and reporting
Finance is an indispensable part of every business organization and financial
management assist the organization in effectively managing the business which is not just

limited to the financial resources procurement and distribution of the resources etc. The
various major roles of financial management and reporting are stated below.
Financial decision making and controls
Financial management plays a vital role in settling on budgetary choices and
practicing control over the finances of the business entity (Al Breiki and Nobanee, 2019).
They utilize procedures like ratio analysis, budgetary preparation, profitability analysis and
so on. These techniques provide relevant information to the management for taking right
financial decisions.
Capital management
It is the role and responsibility of financial management (FM) to estimate the capital
prerequisites of the business entity in a regular interval of time and evaluate the capital
structure and its composition in terms of debt and equity and settles on the decision of
wellspring of subsidizing for the capital needs. A report is prepared based on this evaluation
based on which decision is taken in respect to the sources of finance the organization should
consider for effectively managing its capital structure. A proper disclosure is also made in
respect to it in company’s financial statements as well.
Risk Management
The sound financial management system in an organization prepares all the relevant
reports which will be used by the management for further use (Mayangsari, Murwaningsari,
and Lastanti, 2018). It can be utilized in for the purpose of forecasting and other business
planning and strategy formulation process as it identifies the risk that may occur in the path
of success and so corrective plans are already pre-determined in which helps effectively
facing the challenge or risk.
Complying with regulatory requirements
Financial reporting helps the businesses to conform to different statues and regulatory
necessities. The business organizations are required to record budget summaries to ROC,
Government Agencies. In case of listed organizations, quarterly and yearly outcomes are
required to be documented or filed to stock exchanges and to be published for public use.
Raising capital

The financial reporting can be considered as a backbone of the financial planning,
decision making process and so forth. It is useful for the various purpose of the stakeholders.
It helps the organization in raising funds for the business requirements for both domestic and
oversea requirements (Ferracuti and Stubben, 2019). Based on these reporting, external users
of the reports analyse the performance of the business and accordingly takes decision.
Disposal of Surplus
The choices on how the surplus or the profits of the business is used is taken by the
finance manager of the associations. They choose if profits ought to be distributed to the
shareholders in the form of dividend and how much should be retained and ploughed back in
the business. These decisions are every crucial for the business organizations in respect to
effectively managing the excess funds in an efficient manner.
Financial Planning
The financial managers of the business organizations are responsible for carrying out
the planning process for further business development and growth and attaining success. To
this end, managers also utilizes accessible ad relevant information to comprehend the
requirements and needs of the organization. It also takes into account other factors while
planning such as economic and business environment as well, as it helps in meeting with
uncertain future challenges and risk which is required to be considered and taken care of
while implementing or after executing the plan.
Thus, these roles of financial management is very important for business organization
for attaining growth and success as business runs on finance and management of it is
essential.
CONCLUSION
It is can summarized from the above that a business organization is a combination of
various functions which are indispensable and inseparable as each one is having a specific
role to play. The different roles of human resource, finance and marketing department is
evaluated which helped in understanding usefulness. Along with that the role of financial
management and reporting in an organization is analysed which shows that every business
activity is revolving around finance and without which it cannot go further. Thus, each
function in an organization has its own importance.

REFERENCES
Books and Journals
Al Breiki, M. and Nobanee, H., 2019. The Role of Financial Management in Promoting
Sustainable Business Practices and Development. Available at SSRN 3472404.
Ekpo, N. B., Etukafia, N. and Udofot, N. E., 2017. Finance manager and the finance function
in business sustainability. International Journal of Business, Marketing and
Management. 2(1). pp.31-38.
Ferracuti, E. and Stubben, S. R., 2019. The role of financial reporting in resolving uncertainty
about corporate investment opportunities. Journal of Accounting and Economics. 68(2-
3). p.101248.
Mahajan, R., 2016. Marketing & Innovation in Business. International Journal of
Management, IT and Engineering. 6(7). pp.13-22.
Mayangsari, S., Murwaningsari, E. and Lastanti, H. S., 2018. The Role of Financial
Reporting Quality and Corporate Governance on Competition: Evidence From Mining
Companies. Media Riset Akuntansi, Auditing & Informasi. 18(2). pp.187-204.
Sims, R. R. and Bias, S. K., 2019. AN INTRODUCTION TO HUMAN
RESOURCES. Human Resources Management Issues, Challenges and Trends:" Now
and Around the Corner". p.1.