1. THE SUPERVISOR AS A FINANCIAL MANAGER
FINANCIAL MANAGEMENT
THE SUPERVISOR AS A FINANCIAL MANAGER

2. LEARNING OBJECTIVES
At the end of this session participants should be able to:
Differentiate between Financial Management and Accounting.
Explain how management decisions impact financial performance of a firm.
Analyse the supervisor’s role as a Financial Manager.

3. Observe ethical principles in financial operations.
LEARNING OBJECTIVES
At the end of this session participants should be able to:
Observe ethical principles in financial operations.
Appreciate that all supervisory decisions have financial implications.

4. WHAT IS FINANCIAL MANAGEMENT ?

5. DIFFERENCE BETWEEN FINANCIAL MANAGEMENT & ACCOUNTING?
FINANCIAL ACCOUNTING
The systematic and comprehensive recording, summarizing , analyzing and interpretation of financial transactions.

6. DIFFERENCE BETWEEN FINANCIAL MANAGEMENT & ACCOUNTING?
The effective and efficient management of organizational resources to achieve organizational objectives.

7. OBJECTIVES OF FINANCIAL MANAGEMENT
The objectives of financial management includes ensuring:
adequate supply of funds for the organization
optimal utilization of funds
a sound capital structure

8. PRIMARY OBJECTIVE OF FINANCIAL MANAGEMENT
The PRIMARY objective of financial management is to maximize the stock price of a firm.

9. PROBLEMS WITH PROFIT MAXIMIZATION
The goal is to maximize wealth, not just profit. Since profit maximization:
is a short term perspective
ignores riskiness of various projects
ignores the time value of money
Examples: Maintenance; sale of assets, high risk projects; unethical business practices; manipulation of financial data

10. EFFECTS OF POOR FINANCIAL MANAGEMENT
Cash flow problems
Inadequate resources
Inability to exploit opportunities
Staffing issues
Business failure

11. SCOPE OF FINANCIAL MANAGEMENT
Capital Budgeting
Evaluation of Risk
Financing & Investments
Time Value of Money

12. GROUP ACTIVITY
In groups of five (5), discuss how supervisors can help to enhance the financial performance of their organizations.
(25 Minutes)

13. GROUP ACTIVITY Resource Acquisition & Allocation Staffing Concerns
Quality Control
Risk Identification

14. MANAGERIAL DECISIONS STRATEGIC & OPERATIONAL DECISIONS
What products or services to deliver & how these are done
INVESTMENT DECISIONS
Asset acquisition, expansion etc.
FINANCING DECISIONS
How to finance investments – debt or equity

15. THE SUPERVISOR’S ROLE AS A FINANCIAL MANAGER
Planning and Forecasting
Making Investment and Financing Decisions
Coordination and Control
Risk Management

16. RISK DEFINED A risk is any deviation from what is expected.
It includes all types of uncertainty
It includes upside volatility (opportunities)

17. RISK CATEGORIES OPERATIONAL STRATEGIC FINANCIAL Demand Shortfall
Customer Retention
Pricing
Regulation
FINANCIAL
Debt and Interest Rates Poor Financial Management
Liquidity Problems
Foreign Exchange Movements
OPERATIONAL
Management Capacity
Supply Chain Issues
Cost Overruns
Employee Issues

18. RISK ANALYSIS
Risk Analysis is a process that helps you identify and manage potential deviations that could potentially impact on the chosen solution.

19. QUALITATIVE RISK ASSESSMENT
A heat map is a type of status report with color coding used to score the level of key risks.

20. Risk Avoidance Risk Acceptance Risk Transfer Risk Mitigation
RISK TREATMENT
Risk Avoidance
Risk Acceptance
Risk Transfer
Risk Mitigation

21. QUESTION TIME