What is Financial Planning?
Financial planning for a business is simply that – planning the finances of the business. It is where the financial statements of the business will reflect its financial condition and thus help it to identify its strengths and weaknesses.
Financial planning will enable the owner of the business to use projections and other financial performance criteria to plan for the capital, assets and personnel requirements of the business in order to maximise its return.
Financial planning is central to the business plan. It is the basis on which business decisions are made in order to secure the financial future of the operation.
Basics of Financial Planning
Financial planning is the foundation of every successful business. The planning should be carried out once a year and revised monthly. This planning will include comparing financial projections with actual results.
Financial planning has 2 main objectives.
- It helps the business owner make business decisions about the fi...
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