Question

Summarise the steps you would take to establish and review financial priorities. In particular, where would you collect information on trends, organisational objectives and expected returns to operations and investments from and how would this information be used?

Answer 1

The steps to establish and review financial priorities are discussed as below:

-- Establish goals: The first step to financial planning is establishing goals and provides clarity about the organisation’s financial destination.

-- Gather the Relevant Data: For making a sound financial plan, the relevant trends on the current data in the financial information need to be collected. The complete information must be documented to visualize data and giving the prudent recommendations

-- Analyse and evaluate data: The financial priorities reviews the strengths and weaknesses of the organisation’s current financial situation and makes a comparison to it's objectives, and priorities.

-- Develop the financial planning with recommendations and alternatives: The organisation financial data and needs are analysed and evaluated, and accordingly develops alternatives and recommendations to meet the targets and objectives

-- Implementation of the plan: An action plan is developed to achieve the established goals and targets

-- Monitor the progress of the plan: There can be tax law changes, inflation rates, interest rates, fluctuations in stock market, and economic recessions. As nothing remains constant except change, thus it is vital to revaluate and revisit the plans for it's successful implementation.