Systems for Managing Finance Resources
Care Tech is operating in a very sensitive industry, and its success is based on the management’s ability to plan for its resources appropriately. The financial resource management system offers the management unit of this organisation a rare opportunity to understand various forces that may require urgent addressing and those that can be suspended without affecting the normal operations of a firm. This system is vital for the management because it provides it with relevant information needed when making strategic decisions that may have far-reaching effects on the firm.
- Financial accounting refers to the field of accounting that involves preparing financial statements for the purpose of making a decision by stockholders, bankers, suppliers, government agencies or other stakeholders.
- Cost accounting involves the process of collection, analysis, summarisation, and evaluation of alternative courses of action. The goal of cost accounting is to offer advice about the best course of action that would improve efficiency within a firm.
- Management accounting, also known as managerial accounting, is meant to provide detailed information to managers in order to enable them to make informed decisions. It offers them a better way of managing various functions within an organisation.
- Payment refers to the transfer of value or property from one individual or party to another individual. The payment can be made in monetary terms, on credit, or any other value that is acceptable to both parties.
- The audit is defined by Skousen as “A planned and documented activity performed by qualified personnel to determine by investigation, examination, or evaluation of objective evidence, the adequacy and compliance with established procedures.”
- Budgeting refers to planning for the available resources in order to ensure that they can meet the expenses within an organisation. It is a strategic plan that seeks to allocate limited resources to various unlimited needs within an organisation.
- Procurement refers to the process of acquiring products from external sources. It is a managerial function that focuses on ensuring that an organisation obtains the resources it needs at a reliable cost.
- Governance involves all activities of management that one undertakes in order to ensure that all individuals within an entity work as a team towards achieving a common goal. It involves providing leadership.
- Risk refers to the threat of losing a given item that is considered of high value within an organisation. The risk may occur out of the actions of members of an organisation or because of the external forces that the management has no control over.