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Financial Goal Setting

Financial Goal Setting includes estimating the amount of Capital to be raised by the Firm and the proportionate amount of securities and laying down the policies as to the administration of the financial plan.

Financial Forecasting
Forecasting is the formal process of predicting future events which are going to affect significantly the functioning of the organisation. It implies the techniques of determining in advance i) Requirement of Funds ii) Utilisation of Funds

Techniques of Financial Forecasting


i) Percentage of Sales Methods II) Days Sales Methods III) Simple Linear Regression Methods IV) Mutliple Regression Method V) Projected Fund Flow Statement VI) Projected Cash Flow Statement VII) Projected Income Statement VII) Projected Balance Sheet.

Benefits of Financial Forecasting


i) Information for Financial Decision Making. Ii) Control Device for Financial discipline Iii) Help for successful financial planning Iv) Help for Preparation of Financial plan according to change in economic environment and business situation V) Enables optimum utilisation of funds Vi) Enable Firm to Plan for its Growth and Financial Needs Vii) Provides Warming to the Management Viii) Help to Adopt appropriate Financial Policies

Financial Goals
i) EVA Ii) Free Cash Flow Iii) Return on Net Worth Iv) Price Earning Ratio V) Earning Per Share Vi) Return on Investment V) Sensitivity Analysis