Financial Management

Facilitated by:

Financial Management

Pobal Training Initiative

Using the “Financial Management Guidance” Toolkit

Understanding Financial Management

Planning and Budgeting

Financial Bookkeeping and Controls

Financial Reporting

Understanding Staff Costs

How the tendering Process Works

Online Resources

Agenda

Reference Guide Covers:

-Planning and Budgeting-Financial Bookkeeping-Financial Controls-Financial Reporting-Understanding Staff Costs-Tendering & Public Procurement Procedures-Links to Further Information

Using the Financial

Management Guidance

Toolkit

What is Financial Management?

Reference pages 1 -3 of Toolkit

What does good financial

management mean to different groups of

stakeholders?

- board members- employees

- funders- donors

-beneficiaries

The process of making the best use of an organisation’s resources

Requires:- Use of financial information

- Adequate policies and procedures (preparation, recording and presentation)

Good Financial Management

Planning Jargon Buster (explanation of key terms)

Developing a Strategic Plan

Developing an Annual Business Plan

Developing a Budget

Working out Cashflow Requirements

Managing Risk

Developing a Reserves Policy

Elements of Effective Financial

Management – Planning and

Budgeting(section 1 Toolkit)

When times are very uncertain:

Scenario Planning may prove helpful

Tool … that organisations can use to help them imagine and manage the future more effectively.

Process … highlights the principal drivers of change and associated uncertainties facing an organisation at present and explores how they might play out in the future.

Result: Scenarios … a set of stories that offer alternative views of what the future might look like.

Strong Labour Market

Depressed Labour Market

People feeldisenfranchised

People feelempowered

Business Remains the Same

Society Meltdown

Anything Possible

Social networking dominant

Example of 2 x 2 Schematic for Society

Identifying and Managing Risk

(Reference section 1.8 of Toolkit)

Governance RisksConflict of

Interest

Poor Trustee Skills

Poor Organisational Structure

Operational Risks

Service Quality and Development

Employment Issues

Health and Safety Issues

Fraud

Contracts

Financial RisksCash Flow

Diversity of Income Sources

Accuracy of Financial Information

External RisksPublic Perception and Adverse Publicity

Government Policy

Compliance with Law and

Regulation

Employment Law

Fundraising

Breaches of Company Law

Breaches of Other Legislation

Case Study: Risk Management in

the Social Economy

Group Work:John Robinson and his community group have identified a niche market collecting and safely disposing of agricultural plastics waste from farms around North Munster and South-East Leinster. In groups, identify the risks that you believe John and his community enterprise will have to manage if they are to successfully establish and grow the business.

Report back your findings!

Financial bookkeeping and financial controls jargon buster

Bookkeeping good practice – section 2.1

Apportioning costs

Putting adequate financial controls in place (Annual Review of Internal Controls hand out)

Preventing fraud

Elements of Effective Financial

Management – Financial

Bookkeeping and Controls

(Reference sections 2&3 of Toolkit)

In groups, discuss how you and your board would manage the following scenario.

In preparing your end of year accounts and financial statements, your accountant has drawn your attention to a discrepancy of €10,500. This money appears to have been taken by a senior manager to cover their un-vouched travel expenses during the first quarter of 2011.

What should you do?

Practical Scenario:

Un-vouched Expenses

Annual Financial Statements:

- Provide information about the organisation

- Assist decision-making in relation to the organisation

- Assess risk

- Assess solvency

- Review performance

Elements of Effective Financial

Management – Financial Reporting

(Reference section 4 of Toolkit)

External Auditors: review financial statements in an unbiased way

Internal Auditors: monitor risk management, reporting and control practices

External grant auditors: review activities, performance and that grants are being spent as per funding rules and within budget

Audit of Annual Financial Statements – section 4.8

Types of Auditors

Key Issues to Consider:

Salaries

Travel and Subsistence

Staff Records

Employment status

Statutory redundancy

Understanding Staff Costs

(Reference section 5 of Toolkit)

Competitive Tendering – section 6.1

www.etenders.gov.ie

Procurement Workflow – section 6.6

How the Tendering Process

Works(Reference section 6 of the

Toolkit)

www.pobal.ie www.wheel.ie www.carmichaelcentre.ie www.cro.ie www.erb.ie www.procurement.ie www.ictprocurement.gov.ie www.citizensinformation.ie www.revenue.ie www.ictu.ie

Online Resources