Module 8 - Setting up finance function as start up. Bottomline : Create checklist of what needs to be done, when, and who. Understand finance as subject and function Understand the finance activities and KPIs Identify information you need to manage and make decisions in your performance Identify the differences between a management accountant and a financial accountant Complete the daily, weekly, monthly and annual finance activities checklists You may need to do skills audit of somesort to ensure who ever you have instructing knows what to do. Remember it really depends on the goals and objectives on what skills , experience and size of investment you want. Here is video link https://youtu.be/MY_cmnbjsGM Here is link for previous videos on management accounts https://youtu.be/6ExV7PvE7fA If you need the checklists, get the finance handbook on this links https://www.makro.co.za/books/non-fiction-specialist/management-business-finance/management-business-finance/the-essential-finance-handbook-for-entrepreneurs--2nd-edition/p/29655bcc-89c2-4ff6-ba3b-9b056b18c4e9?gclid=CjwKCAjwkvWKBhB4EiwA-GHjFjcJDNJXL8e1TOD-Kgvnp6yPJkQrr3EE4CCDhSUIVrjelVhf3KC4KBoCjRoQAvD_BwE or https://publisher.co.za/product/the-essential-finance-handbook-for-entrepreneurs/ Focus on step 3 - compliance checklists, step 5 on roles and responsibilities and step 6 on processes and systems. Leave us the comments Twitter: https://twitter.com/PreciousMvulane Linkedin: https://za.linkedin.com/in/precious-mvulane Facebook: https://web.facebook.com/financehandbook/ Website: https://preciousmvulane.com What's Up: https://chat.whatsapp.com/KQNZYJDV5ybLWwI0HwJmzZ

1. How to set up the Finance
Function

2. Precious
Mvulane
Chartered Accountant
Registered Auditor
Serve in 10 Boards, chair 5
Lifetime student of
business since 14 years
Won few awards and
recognitions.
Module 8 2

3. Understand finance as subject and
function in a business
Understand the finance activities
and KPIs
Identify information you need to
manage and make decisions in
your performance
Identify the differences between
finance and accounting
Differences between management
accountant and a financial
accountant
Complete routine financial tasks
3

4. The World of Finance
© 2014 The Essential Finance
Handbook for entrepreneur

5. Financial Goals and Strategy
Module 8 5
What do you need in terms of money
? How are you going to get it?
1. What type investments do you need cash for ? What is
funding model?
2. For short term i.e. working capital how you going to
manage cash flow
3. Cost of capital vs the return on the venture ? Does it
make it viable business?

6. Finance must be linked to Goals
Step 1 - Set up a
Goal/Target - including
KPIs in finance we have
only 4 elements Income,
Expenditure, Assets and
Debt, remember you
keep top, increasing and
bottom decreases. Know
your baseline which
current.

7. Key Performance Indicators
KPIs
Finance KPIs

8. Module 8 8
Making financial
decisions is really
about
understanding ROI
i.e bottom line -
profit

9. What is
Finance
Function
The finance function can
simply be taken as the tasks
of providing funds needed by
an enterprise on favourable
terms, keeping in view the
objectives of the firm.
9

10. 10
The finance function includes judgments about whether a company should make
more investment in fixed assets or not. It is largely concerned with the allocation of
a business’s capital expenditure over time as also related decisions.

11. •Financial planning;
•Forecasting cash inflows
and outflows;
•Raising funds;
•Allocation of funds;
•Effective use of funds; and
•Financial control
(budgetary and non-
budgetary).
11

12. Finance Function – Corporate Finance
Investment Decision
Allocate capital to long term assets i.e. capital
budgeting or capex. It is important to allocate capital
in those long term assets so as to get maximum
return. This can be short term too
Following are the two aspects of investment decision
a) Evaluation of new investment in terms of
profitability
b) Comparison of cut off rate against new
investment and prevailing investment.
Financial Decision
Mod 8 12
2021
Financial decision is about when, where and how
should a business acquire funds. Funds can be
acquired through many ways and channels. Broadly
speaking a correct ratio of an equity and debt has to
be maintained.
A business tends to benefit most when the market
value of a company’s share maximizes this not only
is a sign of growth for the firm but also maximizes
shareholders wealth.

13. Dividend Decision
Finance Function
– Corporate
Finance
13
• Earning profit or a positive return is
a common aim of any the business.
But the key function of finance role
in profitability
• Decide whether to distribute all the
profits to the shareholder or retain
all the profits or distribute part of
the profits to the shareholder and
retain the other half in the business.

14. 14

16. 16

17. 17

18. Why it is
important to
set up the
Finance
Function?
•Charge the correct selling
price
•Set targets that are
measurable
•Know which resources you
need to build your business
18

19. Finance Priorities
Promote strong governance and control in the organization
19
Facilitate improvements in control in
the business
Design an appropriate financial
control framework
Meet increasingly onerous statutory
and regulatory requirements i.e.
compliance risk
Promote management of financial
risk to the business

20. Finance Priorities
Be effective in driving forward the business
Deliver an effective finance
support service to business
units or functions or
department
20
Provide challenge to the
business to meet its
objectives
Strengthen business
decision making throughout
the business
Add value to the business
i.e increase value or
return on investment
Provide timely and
accurate reporting and
business information

21. Finance Priorities
Be efficient in the operation of the finance function
21
Reduce the costs of the finance
function
Realize benefits of investments in
finance
Integrate finance to all business
functions
Streamline business processes
including reporting

22. • Banks – some even have accounting software to use for free
• Apps – free software including open source
• Incubators
• Consulting Firms including Accounting and Tax Firms provide trainings
• Training Companies provide interns and free training
• FASSET – Provides interns in finance
• SARS provide free trainings
Module 8 22
Building your finance team

23. Financial Plan
Business Plan – with cash
flow projections for atleast
5 years
Module 8 23

24. 1.Have your own accounting system which you use to capture
invoices
2.Get bookkeeper or accountant to reconcile monthly
3.File documents in the cloud
4.Back up records on weekly basis
5.Get accounting system that suit your industry
Module 8 24
Accounting

25. Set Tasks in a periodic manner
• Daily Checklist
• Monthly Checklist
• Semi- Annual
• Annual Checklist
25
As a Business Owner one need to have a system to ensure
Accountability

26. Full Details of checklist
26

27. Conclusion
As a serious business owner, you should not appoint random staff who do
not have the professional qualifications to manage their job