importance of financial management is to achieve short & long-term goals in one’s life on before time schedule. Financial Management is the key area of the management system, which controls and guides an organization in a very effective and transparent way. Having a good financial system is considered as a key strength of an organization. Therefore, every organization should require a standard financial management system.
The financial procedure and policy of Apparels Company is not a static document, it is expected to review and update time to time to be a living and evolving document. It is to be assumed that the accounting system of an organization reflects its organizational requirements.
Being a well-reputed garments industry, incorporated advance systems for smooth financial operations. And the management is well aware of the technological advancement and ready to cope with the changes.
Importance of financial management:
The finance department is one of the most significant parts of any organization. It is playing a very important role in the factory.
In any Apparels Company should have a strong finance team.
Post of Finance Team:
- 2 Executive: work for the foreign supplier.
- 2 Executive: work for the Local Supplier.
- 2 Executive: work for the banking transaction.
- An executive: Work for a cash transaction.
- An executive: Work for internal audit.
The different functions of the Finance Department are enlisted below-
- Performance Report: In every month’s performance report is prepared and this report to be completed within 4th of the month. It includes-
- Cash Flow,
- Labor Report,
- Sales Statement,
- Cut-Ship Ratio,
- Fund Flow,
- Liability Status.
- Financial Statements: All the financial statements are completed during the month. Based on this Financial Reports Yearly Audit should be done. The followings are reflected in this report.
- Cost of Good Sold (CGS) Statement,
- Income Statement,
- Balance Sheet,
- Necessary Notes.
Fixed Asset Register Software:
The finance department is using software called Fixed Asset Register. Using this particular software they can provide information about-
- Total asset of the factory
- Location of every asset in the factory
- Cost price of the asset
- Depreciation rate
- Date of purchase
- Suppliers’ details.
- Warranty/Guarantee Period
Internal & External Audit:
Internal: The key responsibility of the audit team is to deal the Income-tax of Foreign and local employee and audit Provident fund account.
External: The key responsibilities of the audit team are to audit the financial reports. We need to coordinate with the audit team at the time of the audit period.