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Module 2
Finance Management
It
is important for every organisation that they plan
for their future. What ever be the profile of the
organisation, it is unlikely to be successful unless
its managers have a clear idea about their plans.
Steps
in the planning process
Planning
is usually broken down into three stages:
1) Setting
the objectives or mission of the organisation.
The
objectives of the organisation would be:
- Identifying
the target group;
- Building
a rapport with the target group;
- Spreading
awareness amongst the target group about the need
of immunising the children;
- Finding
out locations where the immunisation camps could
be arranged;
- Finding
out doctors and nurses who would volunteer to
provide their services;
- Fixing
the date in accordance to everybody's convenience;
- Advertising
about the event, place and date;
- Finding
a person or organisation or corporate who would
fund the programme;
- If
the organisation is using it's own resources,
then making budgets for the entire programme.
2)
Setting long - term plans.
These
are plans setting out how the organisation will
work towards the achievement of its objectives over
a period of, say five years. Like in about five
years the organisation plans to eradicate Polio
from the whole of Maharashtra. They are likely to
deal with such matters as:
- Type
of product or services to be provided by the organisation;
like drops, injections, time interval between
each immunisation etc.
- Amounts
and sources of finance needed to be raised;
- Capital
investments (e.g. new building, furniture etc)
required for the purpose.
- Labour
requirements.
In
each of this case, the objectives of the organisation
for the next five years will lay the foundation
for the plans.
3)Setting
detailed short- term plans or budgets.
Budgets are financial plans for the short- term,
typically one-year. Their role is to convert the
long - term plans into blueprints for the immediate
future. Budgets usually define precise targets in
areas like:
- Cash
receipts and payments;
- Breaking
down into amounts and prices each of the products
or services provided by the organisation
- Detailed
labour requirements
- Detailed
stock requirements
It
must be emphasised that planning is not the role
of accountants; it is the role of the managers.
However, because of their background and their understanding
of the accounting system, accountants are very well
placed to give technical advice and assistance to
managers in this context. This site would provide
information on accounting for the NGO, laws pertaining
to foreign funding, income tax, banking, salary,
etc.
For
more information check out: http://education.vsnl.com/accountaid/
However
well planned the activities of the organisation
maybe, they will come to nothing unless steps are
taken to try to achieve them in practice. The process
of making a planned event actually occurs is known
as control. Control can be defined as compelling
events to conform to the plan. The definition of
control is valid in any context. Thus constant comparisons
between actual and planned outcomes makes the managers
take steps to get the business back on track toward
the achievement of the actual goals.
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