Question: How well did the below post answer What sort of difficulty can you imagine themanager of an organization would be in, if theorganization did not
How well did the below post answer What sort of difficulty can you imagine themanager of an organization would be in, if theorganization did not routinely prepare cash flow forecasts and working capital analyses? What do you agree with or disagree with and why.
Financial accounting allows a organization to track all of its financial transactions. It involves the tracking of all financial data, records and reports all financial data flowing in and out of the organization. Proper financial accounting is important for a organization for several reasons. Not only does it provide the business with a visual and recording of money coming in, and money going out, it provides investors and creditors with how well the organization is doing. Any potential investors in a business and any banks the business may want credit from will review any kind of financial documentation.
Cash flow forecasts and working capital analyses, are in a short description, the budget of a business. A good manager will have a good understanding of cash flow and working capital. Without knowing when and where your money is coming from, a business can go bankrupt in a short period of time. Cash flow forecasts give a estimate within a period of time that a businesses will need to have coming in, in order to make the requirements of what they need going out. It gives a snap shot of where the business will be allocating any revenue that they receive in a certain period of time. Working capital analysis are funds that are involved in the operation of the company. The main focus is to track and determine how much capital is needed to maintain operations.
Without proper accounting and capital forecasting, a organization will fail. Many businesses will outsource their accounting to firms who specialize in this specific area to ensure the accuracy and proper tracking.
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
