FINANCIAL MANAGEMENT ACTIVITIES

By-Ashish Agrawal

Shri Ram Murti Smarak College Of Engineering & Technology,Bareilly,

INDIA

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

Growth of funds

Allocation of funds

Creation of funds

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.

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.

Budgeting process-

• Sales and marketing budget

• Production budget

• Administrative budget

• Investment budget

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

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

Charging policy-

• Communication of information

• Pricing flexibility

• Notional charging

Rates-(Setting of Rates)

• Determining market rates• Analyzing demand for services• Analyzing number of customers and the

competition• Determining direct & indirect costs

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.

THANK YOU