Collins Computing, Inc.

Financial Management Plays a Role in Every Department

Email | Print

A common misconception throughout organizations is that financial management is only apparent within the accounting department. This is far from true and if companies are forcing this to happen, they may be creating a big problem without even knowing it.

If you were to ask everyone in the office who makes all the financial management decisions, would all fingers point to the chief financial officer or lead accountant?  While this is partially true, how much responsibility do the other departments assume for the company’s financial health?  While the accounting department maintains the overall big picture of the company’s finances, data from each department in the company – from sales to marketing to management to the shop floor – all contribute to the big picture.

Employees are the heart of the business, but a company can only sustain a certain number of employees.  Each department should have a budget to determine how many employees they can hire, for what purpose, and at what salaries.  In addition, travel expenses, fixed assets, training opportunities, and other employee expenses should be budgeted for, by each department.

The sales department is easily targeted as being the most responsible for income.  When sales are dragging, they get called upon to get out there and drum up new business.  Because of this, the sales department should have a good handle on potential income through projects that are pending or secured and on the schedule.  The sales department works closely with the marketing department who develops the tools needed for successful sales.   A solid website, good brochures, and media advertising support the sales department’s efforts.  In contrast, both sales and marketing departments can also have serious expenses – from travel and per diems to printing and media advertising expenses.

After taking a look at the departments of your company, do you think it would be appropriate for the accounting department to create the budgets, decide on the salaries of the employees, and collect income projections from every department in the company?  Certainly not!  Each department is responsible for continuously evaluating their efficiency and implementing cost-savings measures wherever possible.  Maintaining a financially healthy company is a team responsibility.  Individual departments are best suited for making their own financial projections and budgets, but they all have to work with the accounting department to determine whether their projections are in the best interest of the company.

PDG Consultants has over 20 years’ experience modifying and writing user friendly interfaces to Microsoft databases. Our services include custom integration from Dynamics CRM to Dynamics GP Experienced database developers and certified consultants for Microsoft Dynamics GP, Microsoft Dynamics CRM, Microsoft SQL Server, and .NET.

Contact us: 201-951-6488 or [email protected]

By PrettyDarnGood Consultants, New Jersey Microsoft Dynamics GP Partner

Related Posts



One question

  1. John Orlando says:

    Financial decisions affect everyone in the company. That’s why it’s important to have a streamlined budgeting system that easily creates reports based on information from different departments. A solution that forecasts for the future is important in the planning process.

    [Reply]

Ask This Expert a Question or Leave a Comment

Subscribe



By RSS:

Rss

Get New Posts:

ERP Software Price Guide