BUAD110 Lecture Notes - Lecture 7: Financial Plan, Cash Flow, Debenture

• School: University of Delaware
• Department: Business Administration
• Course: BUAD110
• Professor: Sullivan Bill

Document Summary

The job of managing a firm"s resources to meet it is goals and objectives. Reasons firms fail financially: undercapitalization, poor control over cash flow, inadequate expense control. Top financial concerns of cfos: ability to accurately forecast financial results, maintaining productivity during an economic downturn, balance sheet weakness, rising cost of healthcare, attracting and retaining top of quality employees. Financial planning involves analyzing short-term and long-term money flows to and from the company. Key steps: forecasting financial needs, developing budgets to meet those needs, establishing financial controls to see if the company is achieving its goals. Budget: sets forth management"s expectations for revenues and allocates the use of specific resources throughout the firm: guide for financial operations and expected financial needs. Capital budget: highlight"s firms plans for major asset purchases. Cash budget: estimates cash inflows and outflows during particular period. Operating (master) budget: ties together all of the firm"s budgets and summarizes firm"s proposed financial activities.