How to manage your finances as an orgnisation, hub or person.
Fianace is one of the strong holds of any organisation or hub, it is what keeps the firm running
Therefore to achieve a sustainable develoment in the tough actuality of today, NGO managers and hub managers should develope understanding and confidence that are necessary to use funds and money effectively.
An effective way to minimize financial risk to the organisation is to ensure permanent official records exists of the organisations activities. Good record keeping helps an orgnaisation function effectively, efficiently and ensures accountability to its members and the public.
Internal controls are the systems used by an organization to manage risk and diminish the occurrence of fraud. The internal control structure is made up of the control environment, the accounting system, and procedures called control activities.
A cash flow is a financial statement that provides aggregate data regarding all cash inflows an organization, a company or even a person receives from its ongoing operations and external investment sources. It also includes all cash outflows that pay for business activities and investments during a given period.
An organisation's financial statements offer donors and analysts a portrait of all the transactions that go through the organization's activities or businesses, where every transaction contributes to its success. The cash flow statement is believed to be the most intuitive of all the financial statements because it follows the cash made by the activities or businesses in three main ways—through operations, investments, and financing. The sum of these three segments is called net cash flow.
Accounting and finance can, and should, be able to help. After all, trust begins with the numbers, as finance professionals well know.
But finance can do more than get the numbers right. It can help build trust both within and outside of the organization by setting an example for process excellence, and by bringing risk-aware strategic guidance to business planning.
Getting the numbers right Among other things, accounting is a practice that’s obsessed with both precision and timeliness. Get it right, and you know it. Get it wrong, and you’re lucky if you’re the only one who knows about it.
Because of this, some type of accounting automation is a must if you want to minimize the risk of mistakes or fraud.
Automation saves time. That’s important for reducing costs, of course, but it also eliminates time-consuming manual work, creating efficiency for accountants and auditors – especially during the intensity of the financial close.
In a 2016 study of more than 750 U.S. financial executives, managers, and analysts, the Institute of Management Accountants found that about two-thirds were “highly dependent” on spreadsheets.
Of the respondents, nearly a quarter said that if they could cut closing times with automation, the most important benefit would be the ability to produce more timely and accurate financial statements.
Adding process validation Automated tools can help relieve the time pressure, but automated processes are even more valuable, says Stephen Wolfman, director of product management for BlackLine.
“With process automation, you get end-to-end accountability,” he says. “The process workflow is where you put your policies and procedures. It embeds and standardizes your internal controls so they work consistently, and it validates the results you’re getting.
“Without the workflow, you could have people saying, ‘Well, for this account we do it this way, and for that account, we do it that way.’ The process workflow avoids that problem.”
This process helps balance the workload, so you can adjust points of pressure before errors occur.
“You get visibility into the process, so you can see if those controls are being applied correctly. With visibility, you can see if there’s some added pressure in one place or another so you can rebalance it to run smoothly and on time. That’s especially important in applications where accounts can change frequently.