Management of a company requires a maximum application of managerial skills. The manager should be in a position op providing the highest standards of ethics geared towards bringing a positive change within the premise. An organization manned by a poor manager is prone to fail within a short period of time. A leader should exercise high quality of headship in every realm since the success of the company entirely depends on him. On the same plinth, he should treat other stakeholders with a lot of decorum and respect for the smooth running of all sectors(Pan and Mishra, 2018 p.668). A financial segment is one of the most sensitive is that should be handled by utmost professional since it is the engine of any institution. The issues of managing the company dept from either outside or inside have been a question from time immemorial, hence worth addressing.
Bringing in the idea of outside consultants to a company to manage the debt will inevitably lead to many issues within the company (Cabello, 2017 p791). The manager may feel inferior that his powers are undermined and there is no need of exercising his managerial skills. It may also lead poor accountability thereafter since the outside manager will eventually go back and it may be difficult for the incoming executive to trace the financial reports. Also, it may be a leeway to competition that may contribute to the downfall of the company in dept. Moreover, the company shall have exposed her innermost secrets to the external auditor thus ending up denting the name of the company. Such cases have greatly led to down fall of originally strong companies.
Use your promo and get a custom paper on
"Financial Accounting".
Internal advisors are always cheaper and have a better understanding of the organization. They can easily help by advising because they best understand the culture of that particular organization(Munro, 2017 p186). Their deep understanding of the company provides integral consultations and can easily bring positive changes aimed at improving the output of the company. In addition, the inner consultants stand a higher chance of maintaining a good relationship between the employees and the institute, which is likely to improve on the channel of communication. Proper messaging is very instrumental in achieving the success of the institution and someone who has a clear background of the company can only maintain this. In this regard, I strongly believe in the management of company dept, an internal consultant is worth than an outsider.
Handling of cash money in any organization is very delicate. It requires the highest standards of keenness and sobriety since it is the panel that controls the well-being of the organization (Alves and Morais, 2018 p.18). Cash is most vulnerable to embezzlement when not handled properly. In order to reduce theft cases of cash within an organization, appropriate pedagogies should be employed. For instance, a record of cash collected should be made immediately and a receipt prepared so that whoever made the payment does not go without a receipt by the end of the economic day. It is also noting that a large amount of money should be avoided at hand. Keeping a large amount of money at hand increases the risk of theft. It also exposes the one handling money to a lot of harm more so by the criminals who at some point might suspect him or her possessing the cash.
In order to effectively control cash, the manager of the company should make a clear channel of records of any cash payments(Berry and Fitz-Gerald, 2017 p.21). If anyone is endorsed to access the records or wants to borrow any cash, he or she should provide his or her original documents to ascertain that he actually took the cash. Some people are good at falsifying the documents, which might end up putting others into problems. A trusted witness should also be present to verify that he actually to0ok the cash so that in case of anything, he can defend the cashier. Moreover, the clerk should be reviewing the books of these two people to clearly approve that the payout is recorded in the accounting book. This is a tall task and requires a lot of time. The person borrowing the money should not get out the financial office before he or she is fully cleared.
In controlling cash, there should be proper documentation of the goods and services bought. Any activity of money usage that takes place within and outside the premise should be put into account and the person who is involved as well. If this is not done, there are chances of losing a lot of money unknowing. Keeping of the daily expenditure report is as well pivotal. Through these report, the financial manager finds it easy to prepare monthly report hence easing the work of the auditor. Any good or service that is provided on a daily basis should be issued with a receipt and the time of purchase stated. The person who does the buying should also sign the before and after the purchase is done so as to give the accountant easy time to do follow up in case of anything. Most importantly, any balance from the purchase should be taken back to the treasury. If this is not done, there are high chances of creating imbalance when calculating the daily expenditure.
There is a daily expenditure that requires money at hand. They do not necessarily need one to move to the bank for a withdrawal (Anureev, 2017 p.281). Payment of goods and services offered to the institution on daily occurrence needs to be paid instantly hence call for having money at hand.
Money kept loses its value at a higher rate. When the money is at hand, it is easily borrowed to employees who might be in a financial crisis. It may also be given to the neighboring institution, which may need it urgently (Pollitt and Mercure, 2018 p.189). If the money is borrowed, there is a high possibility that the money will be refunded by an interest. When money is given out, its value increases. The person lent the money will transacts business with it and eventually earns a profit. On the other hand, the one who gave out the cash will receive it back with an interest.
The money at hand can be used to start a project, which in return generates an income to those, involved in the business. There can be developments just within the premise that can be realized through the use of money at hand. A good example is purchase of means of transport. When a vehicle is bought, it can generate income and help in the daily running of the activities of the company. It will also assist in the movement of staff; hence avoid unnecessary expense on transport. In so doing, there will be increased profit margin within the company and the number of assets shall have increased. External users can also use the means of transport when borrowing, thus generating more in comes to the company.
Management of finance in a company is very important since it controls the day to day activities of the company. Management requires high standard of leadership and professional ethos, logos and pathos within and outside the company. Internal management is also ascertained to be contributing to the progress of any institution as opposed to external assessor. Also, it is important to manage cash flow within any institution. Putting account of all the finances used in a daily basis makes the company run smoothly with a lot of transparency. Lastly, the use of money at hand helps to boost the output of the company. In as much as all these are done, the manager should act at a central point to ensure that nothing goes at a mess.
