Finance can be one of your company’s biggest pain points. Many companies hire consultants to address financial management, but that can add up. What if you had the power to resolve and manage your own finance needs? This article will take you through common financial management problems, and how to solve them efficiently and cost-effectively.
So, what is Financial Management/Planning?
Simply, financial management is an effort to plan, manage, store and control company assets or funds. Implementation must also be carefully done so as not to cause problems in the future. It means applying general management principles to financial resources of the organisation
1. Recording Transactions Accurately
Managing corporate finances requires accurate record-keeping, which many companies find extremely challenging. Without correct financial data, management may be unable to lay the groundwork for long-term profit monitoring. Having a cloud-based portfolio Budget Management tool can help you track monthly actuals against budget and enable you to manage your financial performance ensuring your business stays on track. With a tool like this, you will also be able to see the real-time overview of your financial health in the business ensuring you don’t miss a thing.
2. Publish Accurate Financial Statements
Accurate journal entries translate into financial statements which enable companies to publish accurate financial statements in line with accounting standards. Although this sounds simple, it can be extremely difficult for some organisations. CFOs often act as stewards of an organisation’s financial portfolio and assets. They are also strategic advisors who play a key role in setting actionable goals. Hence an efficient Work Management Solution can help with this structure and drive business strategy to focus on the most important initiatives.
3. Raising Cash
Perhaps one of the most pressing issues for corporate leadership is the firm’s ability to raise cash. A few ideas would be:
- Give traditional financing a shot, banks and financial institutions are age-old resources for raising capital and should be considered. So long as you and your business are solvent, they can usually provide debt options with tremendous flexibility, such as credit cards, personal loans, and lines of credit.
- Focus on the long term. At every stage of growth, a business is grappling with some form of limitation preventing it from levelling up.
- Leverage and Grow Your Network. To pitch your investment, first, you need to get in front of somebody. It can be hard to make inroads with strangers, so business owners sometimes begin their fundraising efforts within their circle of friends and relatives.
4. Repaying Debt
After borrowing money, a company must get a clear picture of what they owe. It is important to formulate a budget, decrease unnecessary spending and find ways to increase business revenue. All in all, business debt can help you fund your business, buy more items, and expand your product and service offerings. However, there’s a downside to having business debt. If your business debt gets out of control, it may destroy your business. Hence, you must pay off your debt as soon as possible to achieve your objectives and keep your business running.
Overall, business finance management should be an integral part of a company’s vision and plan for future expansion. Proper budgeting is vital for growth, though not in the way that most entrepreneurs think: instead of just bean counting, it should be used to develop new business strategies and initiatives. Managing finance may not be fun, but it’s an important task nonetheless. It can even help determine how well a business will do in the long run.