also determined by capitalization
When deciding on raising funds, the financial director should take into account what the bulk of the company’s fixed costs are connected with and what is the situation with interest payments. Otherwise, there is a risk of seriously undermining the financial stability and profitability of the business.
Financing structure issues are important for any manager with the right to make decisions on attracting loans or investments. They are one of the most difficult. Should I use borrowed capital or limit my own? If used, will a bank or private investor be a creditor? If this is a private investor, what conditions to offer him? Etc. Continue reading
For modern companies, the urgent task is the introduction and development of a budget management system. However, even in those firms where the budgeting process is sufficiently developed, employees often make mistakes. Therefore, bottlenecks are important to identify and correct in time.
Usually, the company faces the question: how to make the budget management system (SBU) as efficient as possible? To do this, it is necessary to find out what the budget management system is, what is its purpose and the conditions for successful functioning. A systematic approach to this issue will help to avoid many errors in the formulation and improvement of the SBU in the company.
Typical mistakes made at enterprises when budgeting can be divided into: Continue reading
Business – activity, the result of which is effectiveness and efficiency.
Effectiveness – achieving goals in the external environment, obtaining market, financial, social results. It is expressed in revenue, income, satisfaction of needs, material benefit and moral benefit.
Efficiency – profit, capital growth, increase in net cash flow.
Efficiency is achieved in the external environment in the direction of factors: consumer – product – market (PTR), relying on the capabilities of the internal environment.
The capabilities of the internal environment are determined by three key factors (PRT): Continue reading