Financial management activities


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Financial management activities

  1. 1. By- Ashish Agrawal Shri Ram Murti Smarak College Of Engineering & Technology,Bareilly, INDIA
  2. 2. FINANCIAL MGMT. • A judicious use of capital & a careful selection of sources of capital , in order to enable a spending unit to move in the direction of reaching its goals. • Cost benefit analysis to achieve best quality. • Ensures optimum fund utilization
  3. 3. Growth of funds Allocation of funds Creation of funds
  4. 4. BUDGETING • Planning & controlling the activities of an organization. • Financial plans for the objectives during the period covered by budget • Predicted on the base of historical data otherwise market or assumptions.
  5. 5. Budgeting methods- 1.Incremental-last year figures are used as the basis for new budget. 2.Zero base-starts with a blank piece of paper-zero base. Every expense has to be evaluated & decided if it should be made, as well as what the cost should be.
  6. 6. Budgeting process- • Sales and marketing budget • Production budget • Administrative budget • Investment budget
  7. 7. ACCOUNTING • Defining the cost elements • Cost element structure should be compatible with the methods adopted by business • How the organization will spend the money • Amount for particular activities
  8. 8. CHARGING • For internal costs • Related to billing for activities in organization as – internet connection • billing customers for the delivered services in order to recover revenue • To recover all the costs incurred
  9. 9. Charging policy- • Communication of information • Pricing flexibility • Notional charging
  10. 10. Rates-(Setting of Rates) • Determining market rates • Analyzing demand for services • Analyzing number of customers and the competition • Determining direct & indirect costs
  11. 11. REPORTING Costs are addressed in the regular meetings with the customer under the SLM . Hence , SLM is provided with- • IT services expenditure per customer. • Charging & accounting methods used. • Difference between estimated & actual charges. • Charging disputes with causes & solutions.
  12. 12. THANK YOU