Business and Finance System

Posts Tagged ‘company’

when there are increases in the cash requirements resulting from extended payment deadlines, companies must rely on third parties seeking to obtain the necessary financial means. But the discounting and factoring financial services, while offering advantages to companies for financial management and the liquidity, they also pose a high financial cost and it can not be used in all businesses.

Another point is that in many cases, cause bad loans to the company concerned about economic losses so great that its short-term solvency is impaired. And in the worst failures may force the company to permanently cease their business activities.

So the active management of the collection allows firms to receive a steady and abundant flow of cash, money can be reinvested in the company and therefore do not have to resort to external financing. For which a large cash flow ensures good financial health of companies. And it prevents them from having to resort to temporary funding sources, thus achieving a considerable saving of financial interests.

Now those times when the word was enough to ensure the success of business operations and in which the bad payers were assigned the finger and the margins of commercial activity have already passed into history. Morality in the business world does not punish the poor payment practices, and now intentionally delaying payments to providers is often considered as equivalent to good corporate governance. Currently have a harmful habits universally extended payment posed a significant risk to the suppliers of goods and services.

It should be noted that the deterioration in payment practices not only caused by economic factors, but also reflects a structural trend in relations between companies. Therefore the phenomenon of delinquency should not be attributed solely to changes in economic cycles, but there are also structural causes.

Thus the speed with which collections are made of invoices is essential to business competitiveness. Any delay in charging the longer the time lag between the flow of cash outflows and inflows, causing a marked deterioration in the cash position of companies and causes increase in interest expenses and hence financial costs.

Companies should worry about collecting all sales on time, as each day of delay in payment of an overdue bill to the creditor company is a financial cost, and therefore the collection team’s mission is very important to account firm performance.

And do not forget that one of the key factors for the smooth running of companies is the ability to generate cash, and this capability is directly proportional to the effectiveness of management companies achievable.

Keep in mind that one of the most universal principles of good financial management is based on the axiom that measuring the value of a company is best done by evaluating the cash flows by calculating book profits. Therefore when measuring the wealth of a company, the best size that can be employed is the cash flow and not the accounting profit.

The company receives the cash flows and can reinvest in the business, but accounting profits are recorded when received, rather than when money is actually available to the company.

Consequently, it is more valid to the valuation of a company using cash entries (dynamic concept) that the benefit (static concept) that provides the business. Besides the profit generated is a magnitude more manipulable than cash flows.

Method

Financial analysis, often using financial ratios of the levels of solvency, profitability, business growth.

* Past performance for a specific period eg 5 years
* upcoming performance: using past performance figures and mathematical and statistical techniques, including the present value and future value. This calculation method is the cause of the financial analysis where the statistical errors of the past can cause low predictive future.
* Comparison of the performance is to compare performance among several companies in similar industries.

Financial analysis used to assess business continuity, stability, profitability of a business, business atapun sub project.

Financial analysis performed by a professional who presents the report in the form of ratios that use the information as presented in the financial statements. This report is usually presented to top management of a business as a reference to taking a company policy.

Based on the results of this analysis, the management may decide a variety of management decisions such as:

* Continuing or not to continue the operations of a business or part of a business.
* Conduct the manufacture or purchase of raw materials in the production process
* To purchase or lease production machinery
* Doing the issuance of shares or negotiate to obtain bank loans in order to increase working capital of the company.
* Various other decisions that allow management to do the right choice of the various alternatives that exist in managing the company.

financial analysis used to assess business continuity, stability, and profitability of a business, a sub business or project.

Financial analysis performed by a professional who presents the report in the form of ratios that use the information as presented in the financial statements. This report is usually presented to top management of a business as a reference to taking a company policy.

Based on the results of this analysis, the management may decide a variety of management decisions such as:

* Continuing or not to continue the operations of a business or part of a business.
* Conduct the manufacture or purchase of raw materials in the production process
* to purchase or lease production machinery
* Doing the issuance of shares or negotiate to obtain bank loans in order to increase working capital of the company.
* Various other decisions that allow management to do the right choice of the various alternatives that exist in managing the company.

Corporate work culture is the overall trust (beliefs) and values (values) that grow and thrive in an organization, a basic way of thinking, behaving and acting of the entire human organization, and handed down from one generation to another.

Culture can work in resource use as an effective driving force in achieving its objectives in accordance with the vision and mission of the organization.

Effective work culture can:

* Unify the way of thinking, behaving and acting all beings organization / corporation
* Facilitate the establishment and implementation of the Vision, Mission and Strategies in the corporation
* Strengthen teamwork in corporations, eliminating friction, internal friction arising
* Strengthen the resilience in the face of external pressures.

From the definition above shows how culture plays an important role in the resilience of an organization. Family is the smallest company; there is a father, mother and children. How the implementation of household and the other one will be different, because the properties of different occupants. But there are few things in common between the family and the other one, because it’s like living in a single environment, to create safe and comfortable environment, there are rules that must be understood and adhered to by members of that environment. This regulation is made by people or family environment, so that the regulation be adhered to without the burden, even members of the neighborhood feel comfortable because there are rules, so that each knows “what is allowed and what is not allowed to do.”

Now how to shape the work culture corporative? In the corporative culture, very important leadership role, among others, as: 1) First Adapter, the first recipient and executor of the work culture, 2) Motivator, to encourage human organization / corporation carry out work culture consistently and consequently, 3) Role Model, role model for corporate human on the implementation of Work Culture, and 4) is the creator and manager of strategy, and cultural programs work according to the needs of corporations.

From the above review, it appears that the formation of good corporative culture, the most decisive factor is its people. As good as any rule or system created, without any desire of human beings to change for the better, it all becomes meaningless.