financial performance
Definition of 'Financial Performance'
A subjective measure of how well a firm can use assets from its primary mode of business and generate revenues. This term is also used as a general measure of a firm's overall financial health over a given period of time, and can be used to compare similar firms across the same industry or to compare industries or sectors in aggregation the financial performance of companies means these companies with effective budgetary control and distribute the amount of budget to the necessary section could decrease the amount of expenditure in the company and also increase the amount of profit.
In today's world the Planning and control are major activities of management in all organizations. Budgets are central to the process of planning and control. The involvement with budgets places the management accountant as a key player in the provision of management information.
Budgeting is used by businesses as a method of financial planning for the Future. Budgets are prepared for main areas of the business - purchases, Sales, production, labour, debtors, creditors, cash - and provide detailed Plans of the business for the next three, six or twelve months.
Having known what a budgetary control system is, let us try to understand the need for budgetary control system. We have already noted that a control system is required to measure progress made towards attainment of goals stated in plans, to uncover deviations, if any, to indicate corrective actions and to affect corrections to the organization before the deviations become serious.
As budget is only a futuristic plan how far the actual operations of the information centre have conformed to the budgeted programme will be known only after completion of the budgeted period (i.e., financial year).
Knowing post-facto how much deviation or under spending or ineffective utilization of resources has taken place is, like discussing the ways of avoiding an accident after the accident has
A subjective measure of how well a firm can use assets from its primary mode of business and generate revenues. This term is also used as a general measure of a firm's overall financial health over a given period of time, and can be used to compare similar firms across the same industry or to compare industries or sectors in aggregation the financial performance of companies means these companies with effective budgetary control and distribute the amount of budget to the necessary section could decrease the amount of expenditure in the company and also increase the amount of profit.
In today's world the Planning and control are major activities of management in all organizations. Budgets are central to the process of planning and control. The involvement with budgets places the management accountant as a key player in the provision of management information.
Budgeting is used by businesses as a method of financial planning for the Future. Budgets are prepared for main areas of the business - purchases, Sales, production, labour, debtors, creditors, cash - and provide detailed Plans of the business for the next three, six or twelve months.
Having known what a budgetary control system is, let us try to understand the need for budgetary control system. We have already noted that a control system is required to measure progress made towards attainment of goals stated in plans, to uncover deviations, if any, to indicate corrective actions and to affect corrections to the organization before the deviations become serious.
As budget is only a futuristic plan how far the actual operations of the information centre have conformed to the budgeted programme will be known only after completion of the budgeted period (i.e., financial year).
Knowing post-facto how much deviation or under spending or ineffective utilization of resources has taken place is, like discussing the ways of avoiding an accident after the accident has