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Construct and analyze a Financial plan based on management's strategic intent - Term Paper Example
Finance & Accounting
Pages 8 (2008 words)
CONSTRUCT AND ANALYZE A FINANCIAL PLAN BASED ON MANAGEMENT'S STRATEGIC INTENT Name Institution Outline 1.0 Executive summary 2.0 Annual Budgeted income statement 3.0 Annual Budgeted Balance sheet 4.0 Annual Budget Cash flow Statement 5.0 Selected Financial Ratio’s 6.0 CVP analysis for the full year 7.0 Appendices 1.0 EXECUTIVE SUMMARY This financial statement and balance sheet explains why and how managers project financial statements into the future…
Thus, one purpose of strategic intent is to forecast a firm's financial statements under some specific conditions. Since total assets must equal the sum of total liabilities and owner's equity, any imbalance will require management action. Having forecasted the amount and timing of the imbalance, a financial manager can arrange for financing (such as bank loans or stock offerings) or investment (such as marketable securities) long before the need becomes critical. Strategic intent statements help general managers in overall planning (employment and inventory levels, for example) and problem solving. As forecasts are developed, a manager can analyze the results to identify potential trouble spots and plan accordingly. Finding problems and trying out solutions on paper, months in advance, is much preferred to learning about the problem first hand in real time. Similarly, by “seeing” into the future with strategic intent statements, a manager can anticipate opportunities and prepare to exploit them long before the window of opportunity begins to close. ...
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