Softmagic Financial Planning

Great Essays
When is hard or just impractical to constantly check the agent performing on behalf of a major organization, typically, the agency theory operationalized as corporate governance (CG) (Kochhar, 1996) is an approach that has been used by major organizations to flourish their businesses internationally (Agrawal & Knoeber, 2012; Bhagat & Bolton, 2008). Hence, the next step of the plan involves the definition of goals and objectives. Management by objectives (Robbins & Judge, 2009), is a worldwide accepted method by which leaders and agents agree to fundamental goals, and interact in ways that avoid the constant verification of activities yet providing enough freedom for ideas to flourish locally. Consequently, the Italian leadership team should actively participate in this activity with the U.S. …show more content…
473). Consequently, SoftMagic U.S. CEO must concentrate on finding a balance between the operating plan, the financial execution plan, and the new business strategy. Thus, the creation of a “financial plan” (p. 476) involves several activities. First, the need for a “forecast of financial statements” (p. 476) based on the operation plans (i.e.: sales), including financial ratios and projected profits. Second, a “determination of the amount of capital” (p. 476) needed to realize the operations. Third, forecast the internal funds the organization will generate, and identify any alternative source of funds required for the plans’ fulfillment. Four, develop an understanding and monitoring of market conditions. Five, establish a “performance-based management compensation system” (p. 476) to recognize employees for generating wealth to shareholders. Finally, ensure proper monitoring to ensure the plan will be adapted according to the changes or fluctuations in the

Related Documents

  • Great Essays

    Advantage Of 50 Accounting

    • 1725 Words
    • 7 Pages

    Suppliers will be interested in the financial position and performance of the company it is trading with as it will be able to determine whether they want to trade with the company based on the profit and cashflow of the business and will be able to set a suitable credit limit. Managers will be interested in the financial statements as they have the responsibility of achieving company goals. Financial statements help in the process of making strategic and economic…

    • 1725 Words
    • 7 Pages
    Great Essays
  • Great Essays

    Fedex Case Study

    • 1223 Words
    • 5 Pages

    Similar to our personal finances, planning and organizing resources through budgeting is cornerstone of any business development. Budgeting is a financial standard of performance, which allocates funds in across the operational span of an organization. This is designed and formulated based on the needs of growth and control. Financial figures are evaluated against the budgeting standards and then reviewed for future planning. Working on performance standards and evaluation, balance scorecard module provides the most useful tool for comparing and taking managerial actions.…

    • 1223 Words
    • 5 Pages
    Great Essays
  • Superior Essays

    Budget as Planning and Control tools The success of a company depends on several things, good strategy, business plan, and budget, among others. Budget is an important part in order for a business to function and succeed. According to Business Dictionary, budget is “an estimate of costs, revenues, and resources over a specified period” (Business Dictionary, 2016). A budget is a plan for the financial conditions of a company’s next period. There are different types of budgets in managerial accounting.…

    • 1548 Words
    • 7 Pages
    Superior Essays
  • Improved Essays

    Hence, management accounting produces internal reports design for the necessity of managers inside the organisation, the financial accounting produces external financial statements for public use and presents to shareholders, creditors and governmental agencies, focusing its action on historical aspects generating accurate and timely data observing the organisation as group. When management accounting not only analyses the company as a whole but also divides the organisation into departments (Shim & Siegel, 1999). Although management accounting and financial accounting have different objectives inside an organisation these have a close interaction. As mentioned earlier the management accounting makes use of financial information such as the inflow of stock and company out flow to customers to create cash flows and observe the company profit. This measurement supports management on its decisions making either in short term as long-term.…

    • 1522 Words
    • 7 Pages
    Improved Essays
  • Improved Essays

    What is Strategic Management? Strategic management begins by identifying where the firm is right now, what it stands for and creating a vision for where you want to the firm to be in the future. Next, the leadership of the firm must develop a mission statement defining the corporate values and culture. The next step is to set up plans and objectives in order to meet the outlined performance goals covered in the mission statement. These performance goals can be based on financial performance like return on investments, profits, cash flow, or strategic objectives like becoming a market leader, or gaining an advantage in the areas of research and development, productivity, or social awareness.…

    • 729 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    SAP: Finance Case Study

    • 825 Words
    • 4 Pages

    Introduction This paper will discuss the potential benefits of one or more of the solutions for finance that are available by SAP. For each solution, these benefits will be analyzed and I will determine if I agree with the procedures and explain why or why not. Lastly, information from the previous assignment will be used and a determination whether or not this enterprise module will be useful to my organization. Definitions First, before we can get into evaluating the solutions that are provided by SAP for the finance department, we must understand the roles of finance in any business. The finance department is responsible for many roles in an organization.…

    • 825 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    The Sarbanes-Oxley Act has changed the way leaders do business in the United States because of the requirements set forth in the Act. Those who wish to “report fraud are protected” under the act without the fear of retaliation (Silverstein 2015). This is imperative as it increases the chances for employees to file reports of foul play within a business. Strategic audits assist in corporate governance with four different “strategic factors” which are Strengths, Weaknesses, Opportunities, and Threats” which form the “acronym S.W.O.T” (Wheelen and Hunger 1987). Strategic audits are aid in corporate governance and act as a means of analyzing an organization’s process in making…

    • 863 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    A business model defines how a business creates, delivers and captures economic, cultural, social or other forms of value. The business model provides information and direction on how the organization positions itself within the value chain of its industry. In for profit businesses, business model specifies how the company makes money. When businesses are established they describe in details the architecture of value creation and mechanism they will use to capture that value. This is done through management’s hypothesis on what the customer wants, how they want it, and how the company will best create a structure that meets those needs and make a profit.…

    • 1148 Words
    • 5 Pages
    Improved Essays
  • Superior Essays

    The next section within Dollar Store’s business plan would be the management summary. “This section of the business plan includes a description of the functions that will need to be filled, a description of the key management personnel and their primary duties, an outline of the organizational structure for the venture, a description of the board of directors, a description of the ownership position of any other investors, and so forth” (Spinelli, S., Adams, R. J., & Timmons, J. A., 2012, p. 262). This section is important because it focuses on the necessary expertise that the business needs in order to be successful and putting the proper people in place to carry out the plan. The next section of Dollar Store’s business plan is the financial plan.…

    • 918 Words
    • 4 Pages
    Superior Essays
  • Improved Essays

    Balance Sheet By definition, a balance sheet is a statement of an organization showing its financial position during a specific date or often at the end of every year. As such, it analyzes the assets, credits, and equity of the business to give the manager an overview aspect of the business. The major essence of a balance sheet is that it gives the manager or investors an idea of the company’s strengths and weak points and the amount invested by shareholders. Also, the main ideology driving the balance sheet is that it denotes the acquisition of the assets through making payment either by borrowing cash or acquiring money from investors (Fridson & Alvarez, 2011). This aspect brings out the overall idea of wanting to monitor the company’s financial…

    • 711 Words
    • 3 Pages
    Improved Essays