Financial Management for the Small Business - Brossura

Barrow, Colin

Brossura

ISBN 10: 0749445637 ISBN 13: 9780749445638

Casa editrice: Kogan Page Ltd, 2006

Riassunto

The sharp rise in numbers of new entrepreneurs has been accompanied by the urgent need to become financially literate: the most common cause of business failure is poor financial control stemming from an ignorance of the basics of business finance. Financial Management for the Small Business is intended to help those who find business finance confusing. Now in its sixth edition, it continues to provide advice on proper financial planning and control, and reinforces essential points through the use of questions within each section. Beginning with an introduction to the key financial statements, it moves on to look at the tools of financial analysis - the keys to controlling a business successfully. The final part of the book deals with business planning and budgeting, a vital area of business finance as most new ventures cannot get off the ground without a business plan, and existing businesses cannot expand. An invaluable read for aspiring entrepreneurs and those already in business, this book could mean the difference between success and failure.

Su questo libro

Informazioni sull?autore

Following a career in business where he held senior staff and line positions, including that of managing director of a substantial manufacturing enterprise with multi -plant and multi-country operations he was Head of the Enterprise Group at Cranfield School of Management, a leading European Business School, for ten years. He has been a visiting professor in universities in the US, Europe and East Asia. For five years he was a non-executive director of a high tech venture capital fund, has sat on Government task forces and is now strategic advisor to a number of business owners.

As well as his own books he currently writes freelance, ghost writing and 'Anglicising' books for American authors and lectures extensively on business topics.

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Part 1: Understanding key financial statements

1. The balance sheet - where we are now 3

A personal experience 3; The public picture 6; The structure

of the business balance sheet 8; The ground rules, concepts

and conventions 13; Questions 18

2. The profit-and-loss account - where we have been 19

Dealing with transactions 19; Some more ground rules 22;

Profit-and-loss account for a manufacturing business 24;

Profit-and-loss account for a service business 26; The

structure of a profit-and-loss account 28; Accounting

requirements of the Companies Acts 30; Questions 31

3. Cash flow and funds flow - where are we going 35

Overtrading 35; Forecasting cash needs 38;

Questions 39; Funds flow 39; Question 40

Part 2: The tools of financial analysis

4. Business controls 45

Business objectives 45; Ratios, the tools of analysis 48;

Some problems in using ratios 50; Ratios in forecasting 54; Questions 54

5. Measures of profitability 55

Return on capital employed (ROCE) 55; Return on

shareholders' capital (ROSC) 56; Gearing and its effects

on ROSC 57; Profit margins 59; Calculating tax due 62;

Sole traders and partnerships 63; Company taxation 65;

Which structure is best? 66; Minimizing taxes 67; Value

added tax (VAT) 70; Question 75

6. Control of working capital (or liquidity) 77

The current ratio 78; The quick ratio or acid test 79; Credit

control 79; Stock control 83; Cash control 84; Circulation

of working capital 84; Averaging ratios 85; Questions 85

7. Controlling fixed assets 87

The fixed-asset pyramid 87; Planning new capital

investment 89; Average return on capital employed

(ARCE) 90; Payback period 93; Discounted cash flow 95;

Present value 97; The profitability index 99; Internal

rate of return 102; Risk and sensitivity analysis 105;

Dealing with inflation 106; Discounted cash flow in working capital decisions 106; Launching a new product: a capital budgeting case study 106; Some general factors in investment decisions 109; Questions 112; Discount tables 114

8. Costs, volume, pricing and profit decisions 119

Adding up the costs 119; The components of cost 120;

Fixed costs 121; Variable costs 123; Semi-variable costs 124; Break-even point 124; Margin of safety 126; Costing to meet profit objectives 127; Costing for special orders 128; Real-time pricing 130; Costing for business start-up 131; Costing to

eliminate unprofitable products 133; Questions 135

Part 3: Business plans and budgets

9. Budgets 139

Budgeting for a business 139; Timescale and detail 141; Objectives 142; Market appreciation 146; Forecasting sales 149; Resources appreciation 152; Key strategies and

operating plans 155; Setting the budget 157; Budget

guidelines 158; Monitoring performance 159; Flexing the

budget 159; Seasonality and trends 161; Cash and capital

budgets 161; Building a budget model 162

10. Writing and presenting business plans 163

What financiers look out for 163; Appearance and size 166; Layout and content 167; Writing and editing 177; Who to send it to 178; The oral presentation 179; Business planning

software and online help 180

11. Bookkeeping and flash reports 183

Why you need proper records 184; Starting simple 184;

Building a system 188; Using a computer 191; Monthly

flash reports 198

12. Improving performance 199

Pricing for profit 199; Reducing costs 201; Squeezing working capital 202; The profit-improvement programme 204

Dettagli dell?edizione

• Editore: Kogan Page Ltd
• Data di pubblicazione: 2006
• Lingua: Inglese
• ISBN 10: 0749445637
• ISBN 13: 9780749445638
• Rilegatura: Copertina flessibile
• Numero edizione: 6
• Numero di pagine: 256
• Contatto del produttore: non disponibile
• Persona responsabile: non disponibile