FINANCIAL MANAGEMENT

FINANCIAL MANAGEMENT

Three main aspects to financial management: Quantity Liquidity Performance

Cost Management Techniques Capital Expenditure Cash Flow Budget Specialist Area Budgets Sales Budgets Production Budgets Operating and Service Budgets .

Types of Costs Fixed Costs Variable Costs Direct Costs Indirect Costs

Monitoring Costs Breakeven Charts Cash flow S-curves

Breakeven Charts A visual display of when a business/project will start to make a profit.

Breakeven Charts Sales Line Cost (£) Loss Profit Break-even Point Total Cost Line 20,000 15,000 Fixed Cost Line 10,000 5,000 Unit/Sales

Cash Flow A means of assessing the amount of money coming into and going out of a company over time Can be a Forecast or Statement.

Apr May Jun Total Opening Balance Income Total Income Expenditure Payment Total Income Expenditure Materials Labour Total Exp. Carried Forward

Apr May Jun Total Opening Balance Income Total Income Expenditure Income Payment Total Income Expenditure Materials 20,000 Labour 2,000 Total Exp. 22,000 Carried Forward (22,000)

Apr May Jun Total Opening Balance Income Total Income Expenditure (22,000) Income Payment Total Income Expenditure Materials 20,000 15,000 Labour 2,000 Total Exp. 22,000 17,000 Carried Forward (39,000)

Apr May Jun Total Opening Balance Income Total Income Expenditure (22,000) (39,000) Income Payment 65,000 Total Income Expenditure Materials 20,000 15,000 10,000 Labour 2,000 1,000 Total Exp. 22,000 17,000 11,000 Carried Forward

Apr May Jun Total Opening Balance Income Total Income Expenditure (22,000) (39,000) Income Payment 65,000 Total Income Expenditure Materials 20,000 15,000 10,000 45,000 Labour 2,000 1,000 5,000 Total Exp. 22,000 17,000 11,000 50,000 Carried Forward

S-Curves A display of cumulative costs, labour hours or other quantities plotted against time.

constructionsite £,000

Produced by Gates MacBain Associates ©