Good Financial Management
Top 10 Reasons for Good Financial Management:
- To be accountable to the people who give us money
- To minimise fraud, theft and abuse of resources
- To enable staff to make better decisions on the use of funds
- To be accountable to the communities we work with
- To be able to produce financial statements for regulatory bodies, ie audit
- To plan for the future and become more financially secure
- To achieve the objectives of the organisation
- To get better value for our money
- To enhance the credibility of the organisation
- To strengthen fundraising efforts
Accounting Golden Rules
Here are some of the Golden rules in accounting.
Record everything that you do. You have to keep an ‘audit trail’. That means that another person must be able to follow all of your accounts just from what you have recorded, with no additional explanation.
Be organised. Make sure that all documents are properly filed, and all procedures properly followed.
Be consistent. If you do things one way in one month, then do them the same way in the next month (unless there is a good reason for changing them).
Keep the books up to date. Do not let them go for more than a week without making sure that they are up to date. Try to fill in all the proper books as the transactions happen, without letting a backlog build up.
Do not get stuck on one point. If one thing is being very difficult, then make a simplifying assumption that will allow you to move on. Make a note of it, and discuss it with your manager or an accountant as soon as possible.
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The most important thing in investing is choosing the right place to invest money. You can invest your money in three major places: saving accounts, stocks, and bonds. And you should choose one or all of these according to your preferences and investing goals. For example, if you don't want to lose your money quickly, then put it in a savings account but if you want more than that, then put it in the stock market or bonds market (you might lose some, but you might gain some). The most famous investment strategy is "dollar cost averaging." I've learned it from https://www.humaninvesting.com/retirement-plan-services.