Finance Flashcards

1
Q

what’s the role of the finance department?

A
  • to control cost and expenses - avoid financial problems.
  • to monitor cash flow into and out of the business - enough cash to pay suppliers and wages. profit and good cash flow are very different things.
  • forecast the future - preparing budgets can identify future grands. possible problems can be planned for in advance.
  • monitor performance
  • to provide info about decision making - financial influence on decisions
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2
Q

what’s the limitations of the role of the finance department?

A
  • not all decision can be made based on how profitable a business is.
  • financial information is based on past events so isn’t usually up to date.
  • financial information doesn’t reveal informations on how staff are motivated or external factors or how success the business has been in increasing market share or customer satisfaction
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