A rare non-gaming article explaining an overlooked area of finance.
How To Understand How Many Financiers Your Business Needs
When the owner decides to implement management accounting in a company, the question arises: who will do this and how many people will be needed? The answer depends on the scale, specifics, and capabilities of the business. If you have any financial difficulties, you can always contact Payday Depot and find financial support there.
What Does a CFO Do in a Company?
The classical business structure of the financial department includes two main positions - financial director and financial manager. The first is a manager, and the second is an executive under the direction of the financial director. Then he moves on to the tools - he determines which reports the business needs. And then, if management accounting is being introduced from scratch, the financial director announces how many employees he needs for this. The next task of the financial director is to describe the business processes for collecting information for reports, appoint those responsibly, and determine the rules for preparing data and the deadlines for filling out reports.
The financial director develops articles of reports that are planned to be implemented. He controls the deadlines, checks the correctness of the filing, and generates the main reports - on cash flow (we see how much money), profit and loss (how much profit the business generates), and balance sheet (what resources the company has and who owns it). The CFO reports to the owner and focuses his attention on any achievements or problems. With the help of the CFO, the business owner makes managerial decisions based on numbers, rather than groping or blindly.
What Does a Financial Manager Do?
In the financial service, everything is the same: the financial director manages, and financial managers are responsible for management accounting. Their function is to collect data on the company's financial transactions in the relevant departments and to compile operational reports, on the basis of which three main business reports are formed. In some companies, financial managers also perform accounting functions - they make payments through a bank or cash transactions. In other organizations, management accounting is handled by accounting. Whether this is correct is debatable, but it happens.
Financial and accounting are based on different methods and solve dissimilar tasks. The accountant is responsible for relations with the state - calculating the tax base, calculating salaries, pay taxes. The financier provides the owner with figures on the basis of which he makes decisions. Therefore, it is not easy for an accountant to master management accounting right off the bat, just like accounting for a financier.
What Determines the Company's Need for Financiers?
There are three main factors that affect the staffing needs of the financial department:
- business scale - the number of employees depends on the size of the company and the number of its areas;
- availability of accounting - when financiers do not have to take on accounting functions, fewer such specialists can be hired;
- the professional level of the financial manager himself - the higher his skills, the more tasks he is able to perform.
A common mistake is to charge one specialist with all the functionality of the financial department and accounting. When an employee takes care of all operations in the bank, cash desk, interaction with tax, accounting, and management accounting, the owner will someday have a set of three main reports, but the deadlines will be delayed.
Very occasionally, MMO Games will post on topics unrelated to MMO gaming. With any major monetary decision, be sure to seek independent financial advice, and never take out a high-interest loan unless you're certain you can repay it on time.