Finance is a field that studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects.businessesresourcesrisks

The term finance may thus incorporate any of the following: –The study of money and other assets;moneyassets –The management and control of those assets; –Profiling and managing project risks; –The science of managing money; –As a verb, "to finance" is to provide funds for business or for an individual's large purchases (car, home, etc.). business

Finance Environment TraditionalATMInternet FEDI IC Card

FINANCIAL EDI (FEDI) Combines Electronic Funds Transfer (EFT) with EDI capabilities to electronically transmit data to your organization. Allows for the electronic exchange of payment and remittance information between the Commonwealth and our Trading Partners.

HOW FEDI WORKS FOR A VENDOR? (2) 4. The DEPARTMENT OF ACCOUNTS processes the payment requests and transmits the payment without the remittance information, to the BANK. 5.While the payment information is transmitted to the Bank, the remittance information is transmitted to the Department of Accounts' website.

HOW FEDI WORKS FOR A VENDOR? (3) 6. The BANK passes the payment to the vendor's BANK via the banking network. 7. The vendor’s BANK credits the payment to the vendor’s account by the opening of business on the payment due date. 8. The vendor posts its accounts receivable from the remittance information.

GLOSSARY Trading Partner (vendor) –An organization or person who has signed up with the Department of Accounts for Financial EDI program. DOA (Department of Accounts) –The agency that maintains the general ledger system that processes payment requests to Trading Partners (vendors) and that maintains the EDI payment accounts.

Payment Format of FEDI When the bank receives both the payment and remittance data – –Detailed payment information is contained in the Entry Detail Record, and –Remittance information is contained in the Addendum Records.

ENTRY DETAIL RECORD ADDENDUM RECORDS Contains: trading partner's name bank account number total/net amount paid EDI trace number settlement date Contain: State agency originating payment and telephone number invoice number invoice date customer account number amount paid invoice description

The Benefit of FEDI Transmitting and receiving payment and payment-related information electronically will save cost of processing and receiving paper checks.

Allocating Resources: Budgeting Budgets –Numerical plans for allocating resources (e.g., revenues, expenses, and capital expenditures). Used to improve time, space, and use of material resources. Are the most commonly used and most widely applicable planning technique for organizations.

Types of Budgets Source: Based on R.S. Russell and B.W. Taylor III. Production and Operations Management (Upper Saddle River, NJ: Prentice Hall, 1995), p. 287.