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What kind of financial procedures and systems are used in a firm?
The procedures and systems used by a firm can be cumulatively termed as financial business processes. These processes may include a simple task as entering a financial entry into the account statement on one hand while, on the other hand, it may also contain complex and hard work to predict the future modes of business.
For a company to survive and grow, it must engage in lots of businesses processes at the same time. Therefore, it is implied that the financial managers are equipped with knowledge in subjects they specialize in to rectify complex errors that might creep into the process without anyone's notice.
Note − A company must engage in numerous businesses processes at the same time.
Some of the most commonly used business processes include −
Billing and credit
Compliance with regulations
Working capital management
Preparation of financial statements
Writing accounting policy and procedure manual
Budgeting and budgetary control
Strategic planning and financial analysis
Note − Some important business processes include Capital Budgeting, Business advisory, and working capital management among others.
Making Financial Processes Automatic
Nowadays, financial managers can automate various finance and business processes using the software. Here are three steps how businesses automate the processes −
Creation of Process maps − The first step for streamlining financial business processes is to create a map that shows how to step ahead, when to stop and when to generate the process.
Automating Workflows − This helps managers automate the workflows by utilizing the maps or by creating new modules to handle additional issues. Automation saves money and enormous time.
Monitoring − Once the workflow starts working, the managers need to keep an eye on the business process to understand the nature of the process. It may give enlightening ideas for the finance departments to formulate general and concrete strategies for the betterment of everyone.
Note − The automation of business processes helps managers take a solid decision for the future of a firm.
Timing the Business Processes
Timing is an enormously important issue in the case of financial management. The finance managers must know the times of buy and sell assets and equity. This helps the businesses slim and agile while negating unwanted business risks. Additionally, businesses must also know when to make certain decisions and when not to.
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