In a Small-Medium Enterprise (SME) several accounting and financial-related tasks are typically headed by the Finance Manager. Whereas in large corporates these tasks are separated under different responsibilities, in SME’s these are often bundled in the Finance Department. The Finance Department of a SME is therefore often composed of these departments: Accounting, Controlling, Treasury, IT and Procurement.
Table of contents
Accounting
The Accounting department is responsible for the daily accounting of all incoming and outgoing invoices in accordance with local and international accounting standards. Furthermore, the accounting department is often responsible for payroll accounting.
- Day-to-day accounting
- Correct booking of cost centers
- Preparation of monthly financial statements
- Preparation of yearly financial statements
- Balance reconciliations
- International (e.g. IFRS) and Group accounting
- Preparation of payment proposal lists
- Payroll accounting
- Taxes
- Invoicing
Controlling
Controlling tasks include the reporting, the consolidation of the results of the Group as well as the planning of the Business Plan, Budget and Forecasts.
- Comprehensive Reporting
- Supporting Consolidation and verification of monthly figures
- Analysis of Contribution margin
- Linking financial and non-financial data (Understanding value drivers and e.g. inflation)
- Planning (Forecast/Budget/Business Plan)
- Business cases
- Decision Support
- Cost transparency of locations and business units
- Identifying savings potential
- Value-oriented management
- Liquidity planning
- Scenario analysis for strategic action alternatives
Treasury
Treasury is responsible for payment transactions and cash management, Group clearing between subsidiaries, dunning and funding.
- The hub for all payment-related processes within the company
- Dunning
- Cash Management
- Funding
- Relationship Management Banks
- Clearing
IT
IT (Information Technology) is responsible for providing infrastructure, supporting Project-Management and Cyber Security.
- Modern IT infrastructure (ERP system, business intelligence, Citrix)
- Infrastructure/Standardization of ERP systems
- Availability of Management Information System
- Providing Front-End Systems for Internal Customers
- Implementation of IT outsourcing
- Education/training in the company
- Project Management
Procurement
Procurement has responsibility to order goods and services in an efficient way and according to internal or group guidelines (e.g. tenders, etc).
Bottom-line
The Head of Finance has to ensure that his departments are compliant with rules and regulations (e.g. via internal controls. policies and processes. Internal audit, etc). He/She has to make sure that Finance provides excellent (financial) service to the company.
This means:
- Efficient processes are established
- Monthly reporting enables the company to understand its performance
- Finance is a business partner in the company
- Finance acts proactively within the company and is an innovation driver
When looking at the values of Finance, those could be evaluated:
- Respectful interaction with each other
- Creativity to create something new
- …to stick to agreements and commitments
If you want to set-up or redesign your finance department, contact us, now.
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