FINANCIAL STRATEGY

Financial Strategy formation and implementation



Task 4 (4a) In order to fund the proposed expansion of the business an appropriate mix of short and long term borrowing will be required. Investigate and evaluate the major factors that should be taken into account when formulating this financial strategy.

Financial Strategy formation

Forming the process of financial strategy includes the following steps:

• Define the strategy period;

• Analysis of the company's external environment factors;

• The formation of the strategic objectives of financial activities;

• Develop the company's financial policies;

• developing a series of measures to ensure the company's financial strategy system;

• Score developed financial strategies.

In the development of the company's financial strategy is very important to clear and honest, initially set the strategy and the right time. In our time among commonly used by small companies and businesses, "company - the night", is strong enough to obtain benefits, the purpose of tax evasion and possible liability of the Company on the strength of the existing two - three years, and then often in the same composition , but using a different name. (Williams & Steve, 2002)

So the process of financial strategy should pay attention more to environmental factors, the activities of the company's financial conditions of economic and legal analysis, because it is often a variety of mistakes and crimes committed no criminal intent, but because the basic rules of behavior and ignorance of the law. Equally important is to pay special attention to risk factors, monitor trends in the same time, interest, recording where the enterprise market, taking into account currency fluctuations and the direction of national economic policy.

The company's financial strategy is to form the next phase of the strategic objectives of financial activities. Its main objective should be to maximize their market value. The goal should be to develop all the more clear and concise. These objectives should be reflected in specific provisions and regulations. Under normal circumstances, the use of standards such as strategic:

• Its own financial resources, the annual growth rate;

• Rate of return on equity investment firm;

• Cycling and enterprises than non-current assets

Companies in the financial strategy of the company in the formation of specific areas of the financial activities of the corresponding fiscal policy: taxes, depreciation, dividends, emissions. (Sullivan, et al., 2003)

Next, you must develop a financial strategy to ensure the system provides for the implementation of measures for rights, duties, responsibilities and authorities of the financial strategy of the company responsible for the actions of the corporate sector results.

The company's financial strategy in the final stage of development is the effectiveness of this strategy. This assessment should be undertaken following parameters:

Within the development of the financial strategy consistent with overall company strategy, the possible identification of inconsistencies or contradictions in assessment is factors. Try to improve the goals, directions and steps to implement the consistency of these strategies.

1. The company's financial strategy and the expected changes in the external business environment to assess consistency.

2. Estimated flexible financial strategies, how to quickly and accurately respond to sudden changes ...