Running a business successfully is not just about the day-to-day activities. To ensure that your business runs smoothly, you need to plan your activities, monitor the progress, and take corrective measures as needed. TallyPrime offers support for these too.
Financial controls are the procedures and policies by which an organisation monitors and controls the allocation and usage of its financial resources. The objective of financial control is to see the current performance of the business and take action to improve the performance. In the process of improving performance, you need to identify the resources required for the smooth running of your organisation. Once the resources are identified you need to implement a financial plan and monitor the same to see if that plan is achieved.
You may want to check the projection of the financial position of the business based on estimated incomes or expenses, without making any changes to the source data. Using TallyPrime, you can create budgets, and use a scenario management tool to generate provisional reports for a future period. Apart from that, you can also create cost centres, and allocate the expenses to the respective cost centres. You can also monitor the Cash Flow Statement to monitor the overall cash movement in your organisation and Fund Flow Statement helps you to understand the position of working capital in your business.
Cost Centre or Profit Centre is a part of your financial controlling tools. You can create Cost Centres or Profit Centres for different business units, employees, projects, departments and so on. This helps in monitoring the proper utilisation of the financial resources in the organisation.
To know more, refer to Cost Centres or Profit Centres.
Budget is another effective tool of financial control. A budget is a plan prepared for the flow of funds in an organisation. It contains financial guidelines for the future plan of action for a specific period. It helps to view the planned budget against the actual expenditure. Budgets help you to refine goals and use funds efficiently. It provides accurate information for the evaluation of financial activities, aids in decision-making, and provides a reference for future planning. The purpose of a budget is to control expenses, but at the same time, you can create a budget to track your income.
To know more, refer to Budget.
Scenario management is a tool that enables different displays of accounts and inventory-related information by selectively including certain types of vouchers without affecting the source data. Using the scenario management tool, you can record provisional vouchers and forecast the expenses by including these provisional vouchers in your reports.
Budget and Scenario are two different topics in TallyPrime and there is no link between these topics.
To know more, refer to Scenario.
Cash Flow Statement monitors the cash inflow and outflow in your business. You can also refer to Cash Flow Projection to have a better understanding of the financial position of your organisation in the future. The Cash Flow Statement and Cash Flow Projection help in identifying the opportunities to make an investment for your future growth.
To know more, refer to Cash Flow Statement.
Fund Flow Statement monitors the working capital of your business. This helps you to plan the source and application of funds. The difference in the Source of funds and Application of funds reflects the net change in the working capital. In order to run the business smoothly, you must have a positive working capital. This also helps in controlling the finances of your organisation.
To know more, refer to Funds Flow Statement.
Click the links below for detailed information on using features provided for financial control in TallyPrime: