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Business Financing and Capital Structure
Finance & Accounting
Pages 4 (1004 words)
Finance and Accounting Author Institution Business Financing and Capital Structure The financial planning process involves the below steps: ?Projection of the financial statements: the financial statements act as account for the profits and losses as well as balance sheet in a company…
This enables the determination of the basis of procurement; whether short or long term. ?Forecasting on the availability of funds: most organizations experience steady cash flow. The manager should forecast properly the amounts available to reduce the amount of money borrowed and save on interest payments. ?Establishment and maintenance of control system: proper control measures enhance determination of the adequacy of planning. The control measures facilitate effective utilization of funds. ?Development of procedure: This involves establishment of the basic plans of how the financial planning process is achieved (Brav, 2009). Working capital management Working capital management involves the relationship between short term assets and corresponding short term liabilities of a firm. Working capital management aims at ensuring a firm is capable of satisfying the maturing short term debts as well as the upcoming operational expenses, and it involves managing the cash, amounts payable, amounts receivable and inventories (Brav, 2009). Financial Instruments used as Marketable Securities Marketable securities refer to securities whose liquidation happens with ease. People often invest excess cash in different financial instruments at the highest quality rate. The financial instruments used as marketable securities include the treasury bills, notes and bonds, and stock. ...
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