Question

Discuss the importance of financial planning of your company and how it fits into your business model

Answer 1

A financial plan helps in planning the day to day activities of a business. It helps in budgeting the expenses so that the the business does not overshoot it's expenses. A business model is a plan by which an organizaion will manufacture products, carry out the sale of the products to make a profit. When we incoporate the financial planning into this model, we make sure that the expenses incurred in the business is kept in check. A problem in the business model can be inderestiamting the costs and consequently overestimating the profits. The financial plan helps the business keep the profits and expenses in reasonable and fair values. Any deviations from the currente xpenses will be immediately notified to the management.