Manage Finance and Develop Financial Plans, Sixth Edition, shows you how to control financial results effectively in a small business. To do this, you need to: keep relevant records; report operating results; and plan financial performance.
This book is divided into three parts. Part A, Manage Finances: Financial Records, investigates simple financial records and record-keeping procedures and legal requirements for records. Part B, Manage Finances: Financial Reports, then examines preparing and analysing simple financial reports including income statements, cash flow statements and balance sheets. A business’s tax obligations are also addressed. Finally, Part C, Develop Financial Plans, examines profit planning, capital expenditure, budgeting, cash flow management and financing decisions.There is also a glossary at the end of the book of key record-keeping and financial terms, and a comprehensive index.
Each chapter has exercises within the text, a list of key terms, and a multiple-choice quiz. There are also assessment activities at the end of key chapters. The answers to the quizzes can be found at the end of the book.
After reading this book, you should be able to record, report and plan financial performance to successfully run a small business.
Part A - Manage Finances: Financial Records
Chapter 1: Financial records overview; Reasons for financial records, Financial control process, Financial transactions, Types of financial records, The financial recording system, Effective financial recording, Role of accountants.
Chapter 2: Source documents; Role of source documents, Sales transaction documents, Expense transaction documents, Asset transaction documents, Bank transaction documents, Source document trails.
Chapter 3: Cashbooks; Role of cashbooks, Cash receipts journal, Cash payments journal, Other cashbooks, Bank reconciliation statement.
Chapter 4: Other financial records; Other records overview, Sales records, Wages records, Job records, Fixed asset records, Stock records, 3
Debtor records, Creditor records.
Chapter 5: Records maintenance; Overview of records maintenance, Internal controls, Online security, Records maintenance program,
Record files, Legal requirements.
Part B - Manage Finances: Financial Reports
Chapter 6: The income statement; Profit performance, Income statement explained, Preparing income statements,
Chapter 7: The cash flow statement ; Cash flow performance, Cash flow statement explained, Preparing cash flow statements.
Chapter 8: The balance sheet; Financial position, Balance sheet explained, Preparing balance sheets,
Chapter 9: Financial results evaluation; Reasons for analysing results, Time comparisons, Financial ratios, Interpretation of ratios, Applying ratio analysis , Limitations of ratio analysis,
Chapter 10: Taxation reports; Taxation obligations overview, Income tax, GST, Other taxes, Sources of tax advice.
Part C - Develop Financial Plans
Chapter 11: Profit planning; Desired profit target, Volume, costs and profit, Business costs, Break-even analysis, Setting prices.
Chapter 12: Capital expenditure proposals; Defining capital expenditure, Evaluating capital expenditure, Selecting projects, Valuing goodwill, Impact of capital expenditure.
Chapter 13: Budgeting and control; Role of budgets, Types of budgets, Budget-building process, Annual operating budgets, Annual capital budgets, Annual financial statement budgets, Budgetary control, Long-term budgets.
Chapter 14: Cash flow management; Importance of liquidity, The cash cycle, Working capital controls, Cash flow plan explained, Preparing cash flow plans, Controlling cash flows, Long-term cash flow plans.
Chapter 15: Financing decisions; Financing structure, Financing requirements, Ways of financing, Loan sources and forms, Choosing financing - factors to consider, The financing plan.
BSBSBM402A – Plan small business finances; BSBSBM406A – Manage small business finances
About the authors
Ian Birt is an accountant and registered tax agent. He has degrees in accounting and law, as well as postgraduate diplomas in education and psychology. He has worked extensively in small business, at every level, and for an accounting firm specialising in small business clients.
an has taught small business financial management and taxation over many years in the vocational training system, and has written several successful books covering all aspects of small business management. The following books by Ian Birt are published by Tilde Publishing: Manage Finances and Develop Financial Plans: Running Your Business Better, Fifth Edition; and Marketing and Promoting Your Business: Products and Services, Second Edition; and Be Your Own Boss: The Practical Self-Employment Handbook.