Financial Function Flashcards
Why is the financial function vital?
Without the necessary funding none of the other business operations can function
What is the role of the financial department?
Maximise profit by ensuring that there is enough capital available in the business to carry out operations efficiently
Who is involved in compiling feasibility studies and drawing up different budgets?
Chief Financial Officer (CFO)
What are feasibility studies?
Preliminary investigations into the potential benefits of undertaking a specific activity or project
What is the main purpose of feasibility studies?
Consider all factors associated with project, and determine invest of time and other resources desirable result
Why is feasibility studies a logical tool?
Use before any investment in new project
What is the most important aspect?
Make sure total investment needed is considered
What is the second function?
Address costs and other factors that are indirectly associated
Name the five feasibility studies
- Technology and system feasibility
- Economic feasibility
- Legal feasibility
- Operational feasibility
- Schedule feasibility
What is technology and system feasibility?
Determine whether company has capability to handle completion of project - software, hardware, personnel, expertise
What is economic feasibility?
Determine benefits and savings that are expected - proposed project compare with cost
What is economic feasibility also known as?
Cost/benefit analysis
What happens if the befits outweighs the cost in economic feasibility?
Implement project
What is legal feasibility?
Determines whether proposed project is in conflict with legal requirements
What is operational feasibility?
Measure how well a proposed project solves problems and takes advantages of opportunities (SWOT)
