FU5
Importance of the accounting function, formulating cash flow forecasts, analysis and evaluation
Introduction
In this assignment I will describe the importance of accounting in business, the formulation of a cash flow and how its limitations and constraints can be analysed effectively and I will also evaluate and justify actions a business might take when experiencing cash flow problems.
P1
Why is it important for Freshcook to keep accurate financial records? Keeping accurate financial records allows a degree of control within the business. For example accurate financial records ensure the detection of false or unauthorised transactions.
Keeping accurate financial records is also important because it allows Freshcook to adequately monitor their business performance and check if important factors that drive them such as profits are being made within the business on a continuous basis.
What do you think the result would be of Freshcook not keeping accurate financial records?
Not keeping accurate financial records would place Freshcook in a position of peril as financial statements which are directly influenced by financial records are checked by the HMRC annually. Failure to keep up to date with tax payments would result in a law suit by HMRC on Freshcook.
List four items Freshcook would record under supplier details?
Price of the product- This would be recorded under supplier details because it is important for the customer to know how much is being paid for the product and it also ensures a fixed price is present.
Name of the company- This would be recorded under supplier details because it is a legal obligation and it ensures that the company’s name is not fraudulent.
Delivery time- This would be recorded under supplier details because it shows how long the product will take before it arrives at is destination.
Date and time- This would be recorded under supplier details because the date and time will bear testament to whether the product purchased is real or
Introduction
In this assignment I will describe the importance of accounting in business, the formulation of a cash flow and how its limitations and constraints can be analysed effectively and I will also evaluate and justify actions a business might take when experiencing cash flow problems.
P1
Why is it important for Freshcook to keep accurate financial records? Keeping accurate financial records allows a degree of control within the business. For example accurate financial records ensure the detection of false or unauthorised transactions.
Keeping accurate financial records is also important because it allows Freshcook to adequately monitor their business performance and check if important factors that drive them such as profits are being made within the business on a continuous basis.
What do you think the result would be of Freshcook not keeping accurate financial records?
Not keeping accurate financial records would place Freshcook in a position of peril as financial statements which are directly influenced by financial records are checked by the HMRC annually. Failure to keep up to date with tax payments would result in a law suit by HMRC on Freshcook.
List four items Freshcook would record under supplier details?
Price of the product- This would be recorded under supplier details because it is important for the customer to know how much is being paid for the product and it also ensures a fixed price is present.
Name of the company- This would be recorded under supplier details because it is a legal obligation and it ensures that the company’s name is not fraudulent.
Delivery time- This would be recorded under supplier details because it shows how long the product will take before it arrives at is destination.
Date and time- This would be recorded under supplier details because the date and time will bear testament to whether the product purchased is real or