Financial goals touch on everything money-related that a company wants to achieve within a given period — say, one month, quarter or fiscal year. These objectives may span a shorter stretch if top leadership must cope with an immediate operational crisis, the kind that may happen if a major customer owing substantial amounts suddenly files for bankruptcy.

1. Nasim Siddiqi - Objectives and Goals of financial strategy
When a business consistently is losing money, top leadership may vent a frustration and an
urgency that department heads are not doing the kinds of things necessary to prevent the
operational demise that is unfolding and to deal with it effectively. To right the
organization’s operating ship, senior executives may formulate fresh financial and strategic
goals that functional heads must follow to the letter.
Financial Goals
Financial goals touch on everything money-related that a company wants to achieve within
a given period — say, one month, quarter or fiscal year. These objectives may span a shorter
stretch if top leadership must cope with an immediate operational crisis, the kind that may
happen if a major customer owing substantial amounts suddenly files for bankruptcy.
For a company, economic objectives may be making a specified amount of money at year-
end, increasing sales by 15 percent, cutting costs by 20 percent in segments that are
bleeding cash and raising long-term debts on credit markets by targeting interest rates
between 4 and 5 percent and avoiding lender restrictions that are too stringent.
Strategic Objectives
Formulating strategies is what company executives do to cope with competitive tedium,
understand the tactical moves that rivals surreptitiously are making, deal with the hybrid
problem of customer loyalty and brand positioning, hire competent professionals and
nurture the company’s mid-level brass.
Strategic objectives may cover things like expanding market share overseas and
domestically by 8 percent and 10 percent, respectively; reducing the corporate employee
turnover ratio by 2 percent; cultivating more amicable ties with lenders, business partners
and shareholders; and communicating with regulators more effectively. Employee turnover
deals with how many employees leave a company compared to its total work force.
Interrelation
Notwithstanding their conceptual distinction, financial objectives and strategic goals flow
symbiotically in the way a company runs its businesses. Both concepts are mutually inclusive
— meaning, a major strategic move the organization makes has financial repercussions, and
vice versa. For example, if a business wants to expand overseas but does not have a deep
operating pocket, it must raise funds by selling stocks or bonds. These activities have
financial consequences in terms of dividend or interest remittances.

2. PEST Review
When pondering strategic and financial objectives, an organization’s leadership must review
not only internal factors but also external factors. Business commentators group the latter
factors under the PEST acronym, which stands for politics, economy, social and technology.
Reviewing PEST factors helps department heads formulate strategic and financial blueprints
that align with ground conditions.
Strategic Budgeting
One of the main goals for your finance department should be to create and monitor not
only your overall company budget, but a variety of functional or departmental budgets, as
well. Budgeting requires research to estimate accurate revenue levels based on demand
forecasting. Using annual budget projections, your accounting staff can help you set targets
for profit goals and for overhead and production spending levels. Overhead includes costs
such as phones, rent and marketing, while production costs are those related to making
your product. Create monthly or quarterly budget variance analyses to see if you’re on track
with your revenues and spending or if you need to make changes before expenses get out of
hand.

3. Cost Containment
To ensure you get the best quality at the lowest price for materials, supplies and services,
make purchasing management one of the duties of your finance department. Require that
employees get multiple bids or present some justification for large purchases, and have your
vendors, suppliers and contractors rebid their contracts each year. Look for trends in
spending levels to determine where you can cut costs without sacrificing quality.
Cash Flow Management
Knowing when your bills are due and when you can expect payment from customers you’ve
billed or other sales revenues is critical for any small business. It’s not enough to show a
profit on paper, and your finance function should help you manage your working capital and
credit to ensure you have enough to pay your bills at all times. Make receivables
management a key role for your finance department.
Debt Service
Letting your debt get out of control can have serious long-term impacts on your business.
Keep an eye on your credit use, including interest amounts you’re generating, the
scheduling of your payments and the status of your credit report and scores.

4. Tax Planning
Don’t wait until the end of the year to find out what your income tax liability is. Use
proactive strategies to lower your tax burden, such as depreciating assets and offering
voluntary benefits to employees that help you lower payroll taxes.
Accurate Record Keeping
The most important objective of any finance department is to keep accurate financial
records. This includes helping you meet your legal requirements and ensuring you don’t
spend more than you have by accident. Consider external audits to prevent fraud, and
institute policies and procedures for controlling contracts and payments.