1. Presented by Ms Charmain J. Francis

2. Financial Management is about planning Income and Expenditure, and making decisions that will enable you to survive financially.

3.  Making sure that the organisation can survive

4.  Making sure the money is being spent in the most efficient way

5.  Making sure that the organisation can survive  Making sure the money is being spent in the most efficient way 1. A mother is trying to decide whether to buy her daughter a new dress now, or wait until next summer so that she does not grow out of the dress too soon.

6.  Making sure that the organisation can survive  Making sure the money is being spent in the most efficient way 2. A school governing body is working out how much money they have, because they want to buy new desks for the Grade 1 classroom.

7.  Making sure that the organisation can survive  Making sure the money is being spent in the most efficient way 3. The treasurer of the church is working out how much it will cost to make certain improvements to the sanctuary.

8.  Making sure that the organisation can survive  Making sure the money is being spent in the most efficient way  Making sure that the money is being spent to fulfil the objectives of the organisation

9.  Making sure that the organisation can survive  Making sure the money is being spent in the most efficient way  Making sure that the money is being spent to fulfil the objectives of the organisation  Being able to plan for the future of the organisation in a realistic way.

10. CASH FLOW STATEMENT For 12 month period January to December 2011 2011 JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecemberTotal Begining Cash balance$0.00$46,700.00$27,244.00$15,524.00$56,404.00$104,356.00$142,176.00$189,996.00$237,816.00$264,536.00$293,229.00$324,972.00 CASH INFLOWS $ 131,000.00 $ 101,000.00 $ 141,000.00 $ 151,000.00 $ 136,000.00 $ 132,250.00 $ 101,000.00 $ 1,579,500.00 AVAILABLE CASH $ 131,000.00 $147,700.00 $ 128,244.00 $ 156,524.00 $ 207,404.00 $ 255,356.00 $ 293,176.00 $ 340,996.00 $ 373,816.00 $396,786.00 $425,479.00 $ 425,972.00 CASH OUTFLOWS $ 84,300.00 $ 120,456.00 $ 112,720.00 $ 100,120.00 $ 103,048.00 $ 113,180.00 $ 103,180.00 $ 109,280.00 $ 103,557.00 $ 100,507.00 $ 105,632.00 $ 1,259,160.00 Net Increase (Decrease) In Cash$46,700.00-$19,456.00-$11,720.00$40,880.00$47,952.00$37,820.00$47,820.00 $26,720.00$28,693.00$31,743.00-$4,632.00 $ 320,340.00 Ending Cash Balance $46,700.00$27,244.00$15,524.00$56,404.00$104,356.00$142,176.00$189,996.00$237,816.00$264,536.00$293,229.00$324,972.00$320,340.00

11.  Financial Accountability Being able to give an account of the way the money is spent to: a. Donors b. Boards and committees members, and c. The people whom the money is meant to benefit

12.  Financial Responsibility a. Not taking on obligations the organisation cannot meet b. Paying staff and accounts on time c. Keeping proper records of the money that comes into the organisation and goes out of the organisation

13.  INVESTMENTS

14. a. What is the investment for? Types of investment :  Capital Expense  Increase inventory  New product line  New outlet  New staffing or staff development and training  House and/or Land, car  Education  Fixed deposit (for returns)

15.  INVESTMENTS a. What is the investment for? b. What are the risks associated with that investment?

16.  INVESTMENTS Risks  Business Risk

17.  INVESTMENTS Risks  Business Risk  Valuation Risk

18.  INVESTMENTS Risks  Business Risk  Valuation Risk  Force of Sale Risk

19.  INVESTMENTS a. What is the investment for? b. What are the risks associated with that investment? c. What is the cost/benefit of that investment?

20. Cost Benefit Analysis - Purchase of New machine  Purchase of Machine.................... -$20,000 includes interest and taxes  Installation of Machine..................... -3,125 including screens & removal of existing machines  Increased Revenue.......................... 27,520 net value of additional 100 units per hour, 1 shift/day, 5 days/week  Reduced Labour Costs....................... 18,585 3 operators salary plus labour o/h  New Operator................................. -8,321 salary plus overhead. Includes training  Utilities............................................ -250 power consumption increase for new machine  Insurance......................................... -180 premiums increase  Square footage...................................... 0 no additional floor space is required  Net Savings per Month........................... $14,229

21.  INVESTMENTS a. What is the investment for? b. What are the risks associated with that investment? c. What is the cost/benefit of that investment? d. What resources are necessary to ensure the success of that investment?

22.  RESOURCES BUSINESS:-  Cash  Expertise  Staffing  Equipment INDIVIDUAL:-  Funding  Expertise  Time  Residual Income

23.  FINANCING  Short-Term (from 1 day to 1 year)  Long-Term (from 1year 1month to 25years)

24. FINANCING  Short-Term (from 1 day to 1 year) Bank overdraft Trade credit Credit card Lease Bank loans

25. FINANCING  Long-Term (from 1year 1month to 25years) Term Loans from Banks Shares Debentures Retained earning Public Deposits

26. Famous Quotes and Inspirational Sayings  Always live within your income, even if you have to borrow money to do so – Josh Billings  Before borrowing money from a friend it's best to decide which you need most – Joe Moore  Being rich isn't about money. Being rich is a state of mind. Some of us, no matter how much money we have, will never be free enough to take time to stop and eat the heart of the watermelon. And some of us will be rich without ever being more than a pay check ahead of the game – Harvey B Mackay  Honour the LORD with your substance, and with the first fruits of all your increase: So shall your barns be filled with plenty, and your presses shall burst out with new wine. (Proverbs 3:9,10)

27. Please join us next week when we will have a look at BUDGETING