Literature review
The literature review is conducted in order to identify the financial management practices that are followed in the public sector. The financial management is important for the organization in order to attain the objectives within the available resources and attain the profitability in an effective manner. The practices related to financial management provides with the ability to manage the finances and carry out the activities of the organization. It is important for the organization to follow the practices that can help in the financial management. The lack of the effective financial management system can result in inability to attain the organizational objectives and profitability.
The financial management system and the practices followed in the public sector are focused. It is important for the organization to adopt the methodologies and the practices that can help in enhancing ability to manage the finances so that the operations of the organizations can be carried out in an effective manner with the help of effective allocation of the resources. The supply chain management, asset management and budgeting are the practices that contributes in effective financial management.
The financial management of the public sector is associated with the government’s economic behavior in context to the rules, methodologies, policies and regulations that helps in budgeting, directing, planning, influencing, forecasting and governing the flow of funds for attaining the objectives. It basically deals with managing the taxation borrowing, spending of government, foreign reserves, public finance auditing, level of liquidity, public debts and foreign exchange system to attain objectives. the financial management practices re ,mainly performed by the chief financial officer, accounting officer and the other managers of the organization associated with the supply chain management, budgeting, movable asset management and control. Although the asset management is responsibility of Correctional Services and public works Departments as keeper of the fixed assets. The responsibilities are controlled by Act of Government Immovable Asset management. The supply chain management, budgeting control and movable asset management are the major four areas associated with the financial management practices and supports in achieving the objectives. It is not possible for the organization to attain the objectives without the effective planning budgeting, monitoring, implementation and adjustment and the effective allocation of the resources for the purpose of attaining the objectives.
The supply chain management is helpful in the effective improvement of the financial management in public sector. It is one of the best practices that are accepted globally. It helps in addressing the budgetary planning processes of the Government that focuses in outcome of the expenditure in terms of sourcing of services, assets and goods (Mathiba, 2011). A specific amount of money is spent by are spent for the procurement of the services and goods. The procedures and the policies are developed that can focus upon managing the acquisition of the services and goods. Supply chain management is associated with the business strategy of the organization and hence helps in supporting the organizational objectives. Every organization needs to buy the supplies, services and materials for the purpose to support the organizational operations in an effective manner (Lysons & Farrington, 2016).
Description
In the present time, the focus of the organizations are upon total spent and on establishing the relationship among sellers and buyers and the procurement as a results has become a strategic activity. The effective management of the supply helps in providing with the benefits in terms of consumption of lower cost, lower inventories, greater agility, higher productivity, enhanced customer loyalty and higher profits. Hence, it is one of the most important practices that are followed by the organization for the purpose of the financial management and the management of the financial system of the organization in an effective manner (Bowersox, 2011).
Supply chain management is important for the other managers as they are able to get the information related to the material and resource flow that can help in creating value in terms of services and goods. It helps in managing the funds that are allocated for resource procurement required for daily operations of firm. At this level, the actual financial expenditure occurs hence the involvement of the management is important to make sure that processes and the procedures of supply chain are as per the plan (Rhodes, Warren, & Carter, 2009).
The accounting officer is responsible to carry out the functions such as developing and submitting the draft budget of the department to treasury and implementation of approved budget of department. Budgeting is considered as the part of planning process of the organization that begins with the aim of organization. With the help of strategic management process, the managers are able to develop the plans strategically that incorporates the process of establishing the objectives and the mission as well as in identifying the methods that can help in accomplishing them (Baker & Nofsinger, 2012).
The strategic budget plan helps in developing operational plan and shows how the company will carry out the operations and the activities on regular basis within the budget. The budgets are developed in order to attain the goals (Maina, 2016). The development of the budget is important in order to carry out the activities of the organization within the cost. It also contributes in providing with the support for the effective financial management. Budgeting is a practice that helps the organizations and the managers to ensure the effective financial management (Riley & Colby, 2010).
The decisions related to the capital budgeting are important as it affects the profitability and the ability of the organization to survive in the organization. The decision of capital budgeting are mainly associated with the profits earned and fixed assets of the organization. The capital budgeting also leads to enormous amount of funds outflow for long time and stressing funds to investment (Katjiruru, 2016). Hence, it is important for the organization to make right decision for the effective financial management. The profits can be maximized with the help of the good capital budgeting decisions. Using the appropriate techniques for the purpose of the capital budgeting can help the organization to increase the profitability and effective financial management (Rathnayaka, 2012).
It is essential to track, coordinate and deliver all movable assets. It is important for the administrator to make sure and develop accounting and inventory of acquired assets, labeling of the assets in an appropriate manner developing an identification system and create the database of activities related to assets in the organization. The asset management is associated with the effective financial management and it is important for the organization to record and manage the assets so that the assets can be used in an effective manner for the organizational development (Hedges, 2016).
Supply chain management system
In the public sector, the organizations are adopting the practices of the asset management in order to strengthen the finances, as it can help in managing, utilizing and investing the assets in an effective manner. Apart from this, the activities of the organization can be funded in a proper manner with the help of asset management. It is possible for the organization to manage the finances when the practices of proper budget and allocation of the resources is followed (Bandy, 2014). It is important to control, monitor and evaluate the financial management system in order to establish the ability to make sure that the goals and the objectives of the organization can be attained within the available resources. This can also help in identifying the problems associated with the financial management and control all the financial transactions (National Audit Office, 2013).
In order to obtain the data and the information to analyze the financial management practices of Emirates airlines, the interviews has been conducted with the managers associated with the finance department. With the help of interview, it has been found that in order to manage the finances, the managers of the company make sure to obtain the information from the other departments related to the activities and flow of funds. All the financial transactions and the assets of the company are recorded and tracked. This helps the company to eliminate the issue of inability to obtain the information related to available assets and the outflow of funds. The company makes sure that the goods and materials are obtained from the suppliers in a manner so that the operations of the organizations can be carried out within the available resources and the finances can be managed in an effective manner. This also helps the company to attain profitability through keeping inventories. The managers also focus on strategic budgeting and developing the budget in order to accomplish the operations within the estimated budget. This helps the company to meet the goals and increase the profitability.
The supply chain management, asset management and budgeting are the practices that help in enhancing the ability of organization to manage the finances in a proper manner. The supply chain management helps in making sure the consumption of the resources in a right and profitable manner. The asset management and keeping the records of the transactions can help in providing with the ability to track the availability of the finance. The budgeting process provides with the support to accomplish the activities within the limited resources. Through the analysis of the financial management practices of Emirates airlines. It has been found that all these practices provided with the ability to organization to effectively manage the finances. It also contributed in enhancing the profitability and carry out the activities and managing the finances through implementing the effective financial management practices.
Conclusions
The financial management practices are important for effectively managing the finances of the organization. The profitability can be attained with the help of effective practices of financial management. The supply chain management can help in managing the finances. It is essential to obtain the information to track the information about the money spent for acquiring goods and services. The asset management and keeping records of can help in making effective use of assets. The budgeting helps in estimating the cost that can be consumed in accomplishing the activity within the limited resources.
References
Baker, H. K., & Nofsinger, J. R. (2012). Socially Responsible Finance and Investing: Financial Institutions, Corporations, Investors, and Activists. New Jersey: John Wiley & Sons.
Bandy, G. (2014). Financial Management and Accounting in the Public Sector. New York: Routledge.
Bowersox. (2011). Supply chain logistics management. Tata McGraw-Hill Education.
Hedges, M. (2016). Digital Asset Management in Theory and Practice. US: Facet Publishing.
Katjiruru, T. G. (2016, March). A review of capital budgeting decisions in Namibia’s state-owned entreprises. Retrieved from https://repository.unam.edu.na/bitstream/handle/11070/1661/Katjiruru_2016.pdf?sequence=1&isAllowed=y
Lysons, K., & Farrington, B. (2016). Procurement and Supply Chain Management. US: Pearson Education Limited.
Maina, R. W. (2016). The role of Public Financial Management practices on service deliveryin selected counties: Perception of members of county assembly. Retrieved from https://41.89.49.13:8080/xmlui/bitstream/handle/123456789/1170/Maina-The%20Role%20Of%20Public%20Financial%20Management%20Practices%20On%20Service%20Delivery%20In%20Selected%20Counties%3a%20Perception%20Of%20Members%20Of%20County%20Assembly.pdf?sequence=1&i
Mathiba, L. S. (2011, March). Evaluation of Financial Management Practices. Retrieved from Core.ac.uk: https://core.ac.uk/download/pdf/37326897.pdf
National Audit Office. (2013). Financial management in government. Retrieved from Nao.org.uk: https://www.nao.org.uk/wp-content/uploads/2013/06/10097-001_Financial-Management-Full-report.pdf
Rathnayaka, R. (2012). Financial Management Practices in Public Sector Institutions: A Study of Capital Budgeting Techniques in Sri Lanka. Proceedings of the 13th Annual Research Symposium (p. 150). Sri Lanka: University of Kelaniya.
Rhodes, J., Warren, & Carter, R. (2009). Supply chains and total product systems: A reader. Malden, MA: John Wiley & Sons.
Riley, S. L., & Colby, P. W. (2010). Practical Government Budgeting: A Workbook for Public Managers. New York: SUNY Press.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
