manage finances

Download Manage Finances

Post on 07-Oct-2015




0 download

Embed Size (px)



Profits declined considerable in 2010 and 2011 after a good performance in 2009. The reasons were mixed but controllable. In 2009, revenues were up and expenditure was low. In 2010, expenses were pretty much the same but revenues dropped, creating less profits. In 2011, revenues were up but so were the expenses.





Main areas for profit have been rooms division sales and food and beverage sales. Main areas for loss have been more than expected expenditure by housekeeping and kitchen. Profits and losses are also closely linked to the quality of our Standard Operating Procedures. Poor procedures that are inefficient lead to more labour costs and higher expenditure figure at the end of the financial year.

1.2Profits and loss are linked to each decision made on every single day throughout the financial year within the organization. No one person or operation can lead to surprising losses. They are a chain reaction, one decision leading to the other catastrophe. Although Crimson is not in loss, the profits are not as much as they could be considering the fact that we have done better at same scales in the past.

Reasons for less than expected profits at Crimson are due to several factors across an array of hierarchical issues and personnel. A few of these are:

Poor employee interaction High internal workplace politics Weak SOPs Unregulated working hours and Roster management Poor Inventory management High food costs Poor service leading to higher discounts Higher interest rates from banks Lack of employee induction and training

1.3Crimsons new Corporate Marketing Plan is all about attracting new customers and retaining them through excellent service standards. Inform-Attract-Deliver-Retain is the new strategy under which they plan to re-launch their hotel brand to promote growth within mid-segment market. This entails companies, which are looking for medium-priced accommodation option for their employees and clients. Critical dates for the new plan are set in accordance with the fact that it will take around 8 months to make the plan fully functional and achievable:

Step Timeframe

Charting the Plan1 Month

Approval2 Weeks

Finance Allocation2 Weeks

Budgeting1 Month

Marketing2 Months

Launch1 Month

First Result Cycle2 Months

Primary resources that would be required for the corporate marketing plan will be:

1. Finances from liquid funds/loans2. Assets from already existing register3. Human resources4. Equipment, facilities and supplies

1.4Cash flow is the dominant tool to analyse the performance of a company. Cash flow is the movement of money into or out of a business, project, or financial product. It is usually measured during a specified, finite period of time. Measurement of cash flow can be used for calculating other parameters that give information on a company's value and situation. Cash flow can be used, for example, for calculating parameters: To determine a project's rate of return or value. To determine problems with a business's liquidity. As an alternative measure of a business's profits when it is believed that accrual accounting concepts do not represent economic realities. Cash flow can be used to evaluate the 'quality' of income generated by accrual accounting. When net income is composed of large non-cash items it is considered low quality. To evaluate the risks within a financial product.In case of Crimson, analysing the cash of flow over last three years, we observe the following:201120102009

Cash Operating Profit$435.84$402.45$493.56

Cash Activities$30.53$85.40-$45.36

Net Cash$466.37$487.85$448.20

Cash Invested-$748.95-$649.90-$1,105.74

It clearly shows that the money management has improved over the last few years and long-term investments have been more closely monitored to be invested in. purchase of fixed assets has increased and so has the sale of fixed assets. Interest received has also seen a substantial rise in last two years while the long-term deposits placed with subsidiaries have reduced.

1.5Tax is a legal duty towards our government, which in turn, manages our communities for us and makes our environment a better place to live. Statutory requirements depend a great deal on the nature and type of business we operate. The nature of our business determines many of the statutory requirements we need to meet.The structure of the businessFor example, we need to consider: Whether our business will be a company, partnership, sole trader, or trust. Each has different requirements Business registration requirements. If we're not trading under our own name, we need to register our business name Australian Business Number (ABN) registration. All businesses must have an ABN Goods and Services Tax (GST) registration.Employing staffIf we intend employing staff, we may need to consider: Pay As We Go (PAYG) withholding tax Payroll tax The Superannuation Guarantee (SG) Awards or agreements Workers compensation (WorkCover).LocationDepending on where we locate, we probably should consider local government regulations dealing with: Development applications Building permits Height restrictions Parking requirements Landscaping.Our industryDifferent industries often require different licenses. For example, a restaurant requires a food operator's license, whereas a building company requires a building license. The licenses and permits required vary according to the type of business and the local government in which the business operates.This subject goes on to cover: Sources of statutory requirements for different types of businesses The help we can get with statutory requirements from SmartLicence other sources of assistance.1.6Using software to assist in keeping our finances in order is a great way to stay on track. Most financial software will allow we to keep track of income, expenses, and even our investments. Some even have the option to automatically download or connect to our financial institutions via the Internet, which can simply the process even further.

1. Quicken Premier 2009Intuit's Quicken software has been a staple for many people for years, and the 2009 edition continues to deliver the goods. Quicken allows we to easily track every aspect of our finances, from income, expenses, real estate, and our investments. As an added bonus, we can also directly connect to our bank or brokerage account through the web so that we don't have to worry about importing or manually entering data for most transactions. If we're a Turbo Tax user, we'll also enjoy the simplicity of importing our data from Quicken right into our tax return in Turbo Tax.

2. Microsoft MoneyMicrosoft Money Plus Premium makes it easy to begin planning for our future, whether it is saving for college, getting out of debt, or building our retirement nest egg. Microsoft Money Plus Premium 2009 takes investment management to a new level with enhanced features that allow we to track our investments in great detail as well as having quick access to research tools. It is important to note that Microsoft Money is being discontinued as of 2009. We can still use existing software, but there will be no more updates going forward.

3. Mvelopes Personal Budgeting SystemUnlike Quicken or MS Money, Mvelopes is an online software tool. The real benefit to this type of system is that we can access our information from any computer that has Internet access. Mvelopes is also different in that it focuses on budgeting. Money and Quicken have a broad coverage of financial tools, but Mvelopes lacks the more advanced investing and reporting features. But if we are looking for software that can help we get that budget started and keep track of where our money goes, this is a great alternative.

4. Mint.comIf we're looking for a good free money management option, look no further than Mint is an entirely online application that allows we to manage and track our expenses from any computer. In addition, Mint seamlessly integrates with most existing bank accounts to easily import our data. If we're always on the go, Mint even has a mobile phone application that can help we keep tabs on our spending wherever we are. A few more have been compared below:

2.1 Resource allocation is the distribution of resources usually financial - among competing groups of people or programs. Resource management and hence, careful and planned allocation is vital to reduce waste, maximize efficiency and making required resources readily available to the managers. Achieving such target would put the company in a very strong position wherein all the managers have access to all the resources they require and such resources are being used at multiple levels across multiple departments making full use of time and efforts. This will give Crimson a strong competitive advantage and reduce its costs further and ensure higher product and service quality. In order to achieve this, it is important for the resources manager to know and understand what resources are required, where can these be arranged from, what resource is meant for more than one purposes, who need what resource, when and how frequently; and, the respective budgeting for such resources. Following will be the resources required by Crimson for the new plan: Manpower (Engineering and Maintenance) Human Resource (Operations) Financing Stakeholder Communication Personnel Marketing Resources Media Resources IT Resources2.2Additional Cost Estimation Plan:ItemCost










View more >